Missouri throws first big wrench into Aetna-Humana deal

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Missouri insurance officials have issued a preliminary order (PDF) against the merger of Aetna and Humana, the first state to find serious antitrust problems with the massive transaction.

However, Aetna and Humana have 30 days to “submit a plan to remedy the anti-competitive impact of the acquisition.” That likely means the state may push the health insurers to divest Medicare Advantage plans in areas where competition would have been smothered.

But some antitrust experts aren’t convinced selling off assets to another insurer will solve all concerns. And Missouri’s decision raises questions and widely differing opinions about how to define competition in Medicare.

“The history of divestitures curing antitrust problems is a very shady history, and that’s especially true for insurance companies,” said Barak Richman, an antitrust law professor at Duke University. “It usually does not create a meaningful competitive counterforce.”

John Huff, director of the Missouri Department of Insurance, wrote that if Aetna’s $37 billion takeover of Humana goes through, the two health insurers “shall cease and desist from doing business” throughout the entire state with regard to certain products. Specifically, Aetna and Humana would no longer be able to sell individual, small group and employer-based Medicare Advantage plans in Missouri.

Read the entire article: Modern Healthcare

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