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February 23, 2016

On February 23rd, 2016, Consumers Union, U.S. PIRG, SEIU Healthcare Illinois and Indiana, Illinois PIRG, Health & Medicine Policy Research Group, Consumer Federation of America, Consumer Watchdog, Citizen Action of Illinois, Consumer Action, the Citizen Advocacy Center, and the Sergeant Shriver National Center on Poverty Law filed comments to Illinois Director Anne Melissa Dowling regarding the proposed merger of Aetna-Humana. The purpose of these comments was to raise concerns about the merger and its impact on healthcare within Illinois. The parties noted a number of issues with the merger including potential higher premiums for consumers. Here are some of the specific points raised:



  • Illinois law gives the Department of Insurance and the Director extensive powers to investigate insurance mergers to determine if they are in the public interest and to hold public hearings to access their competitive impact. The Department should hold a hearing on the proposed merger.


  • This merger would substantially reduce competition in Illinois and increase concentration beyond the threshold that triggers significant concerns under federal and Illinois antitrust law. The combination of Aetna and Humana would also possess a 37% market share in Medicare Advantage (MA) and eliminate MA competition in 56 counties across the state.


  • The merger would increase costs for consumers. Studies on health insurance mergers have found significant premium increases post-merger. There is also little evidence that consumers benefit from any of the potential savings.


  • Individuals and organizations are worried that this acquisition will further reduce network adequacy. If the market becomes so concentrated that dominant insurers can restrict or eliminate broader network options, that will harm consumers who are willing to pay more and would like a broader network.


  • The merger will also render it more difficult for new competitors to enter the health insurance markets. In Illinois, entry on the health exchange or within the Medicare Advantage market has been very limited, and there has been no evidence of entry in the small group, large group, or ASO (administrative-services-only) markets.


  • There is no evidence showing that insurance mergers lead to savings for consumers, and divestiture is not an effective remedy for restoring competition in this situation. However the Department has the power to develop its own solutions for health insurance mergers.



To see the full comments submitted to Director Dowling, click here.  


To see the full comments submitted by the Illinois Health and Hospital Assocation to Director Dowling, click here


To see the full comment submitted by the Illinois Health and Hospital Assocation to Illinois Attorney General Lisa Madigan, click here. 

On June 23rd, 2016, the Illinois Department of Insurance approved the Aetna-Humana merger. To see the order approving the merger, please click here


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