In the first known attempt to derail the mega-merger of United HealthCare Corp. and Humana, the Florida Medical Association is considering jumping directly in the path of the proposed consolidation.
A draft policy to be considered by the association's board in mid-July recommends "that the FMA investigate potential antitrust violations related to the proposed merger and vigorously pursue assistance from the appropriate state and federal regulatory entities," said Patrick Hutton, M.D., of Orange Park, Fla.
Hutton is chairman of the FMA's council on medical and socioeconomics, which voted June 27 to recommend that the 16,000-physician association's full board of governors try to block the deal by raising antitrust concerns.
In response, Phil Soucheray, a spokes-man for United, said, "We certainly acknowledge the concerns that the doctors are expressing."
But the two companies believe their merger does not raise any antitrust issues, Soucheray said, "and we anticipate that services to members and also selection of specialists will actually be enhanced and improved as a result of the merger."
Medical association officials said the FMA board will consider the proposal July 18. Hutton predicted the board would approve the measure, which he said has inspired little or no opposition within the organization.
However, a spokeswoman for the Tallahassee-based FMA, cautioned that the proposal "could be accepted, rejected or modified" by the board, which has final say on policy.
Under the proposed merger announced in late May, United would acquire Louisville, Ky.-based Humana for about $5.5 billion, creating the nation's largest managed-care company, with more than 10.4 million enrollees (June 1, p. 2).
The merged company would boast $27 billion in annual revenues and 50,000 employees in all 50 states. Both companies' boards have approved the agreement, which still requires shareholder and regulatory approval. The companies hope to complete the sale this quarter.
Soucheray said that nearly all the filings that needed to be made for state and federal antitrust clearance have been made.
The merger would give United considerable market clout in Miami and the rest of South Florida, as well as Chicago and possibly Missouri, Ohio and Texas, among other markets (June 15, p. 22).
In Florida, members of the FMA are concerned about "the monopoly situation" the merger could create, especially in South Florida, according to the FMA's Hutton. He cited HCFA figures showing that the deal would give a post-merger United roughly 35% of the Medicare market statewide, more than 50% of that market in South Florida and up to 70% in Tampa Bay.
The merged company would have more than 250,000 Medicare HMO enrollees in South Florida alone, according to HCFA.
The association's legal counsel will soon be in contact with state and federal regulators about their concerns, Hutton said.
Sources close to the medical association say it is ready to work aggressively on the issue with the U.S. Justice Department, the Federal Trade Commission, the Florida state attorney general's office and the Florida Department of Insurance.
The state insurance department received a merger-related filing from United on June 12, which set in motion a 90-day period during which the agency can request more information, schedule public hearings, and approve or disapprove the merger, according to spokesman Don Pride.
The department will judge the deal's anticompetitive aspects. If the department needs more information from the companies, it can extend the 90-day review period.