Consumers need Competition

We continue to believe that the proposed deals by four large insurers is bad for consumers because it will likely result in higher premiums. Last week the AHA sent a letter to the Department of Justice that raised concerns about the proposed Anthem acquisition of Cigna focusing on the impact of Anthem’s affiliation with the Blue Cross Blue Shield System.

Despite claims that consolidation in the hospital field would be bad for health care and patients an April 2015 study by a leading health care expert and antitrust economist that found “concentration or structure alone is not a meaningful or reliable predictor of price changes.”

Hospitals merge in order to build a better more durable continuum of care for patients.  Mergers enable many hospitals to provide patients with integrated clinical arrangements to replace uncoordinated episodic care.  And they often keep the doors of financially failing institutions open, providing medical access to patients in communities that might otherwise lose it.

Independent research on previous insurance market consolidation shows that insurers do not share savings with their customers. In fact some increased health insurance premiums. The bottom line is that consumers end up paying the same amount – or even more – for their coverage.

The AHA will continue to ask DOJ to challenge these acquisitions and to examine the impact on competition.