The American Association of Health Plans and the Health Insurance Association of America are nearing a formal announcement of their proposed merger and naming Karen Ignagni, currently AAHP's president and chief executive officer, as leader of the merged organization, sources said last week.
The merger is expected to be announced this week.
It was not clear what the role of HIAA President Charles "Chip" Kahn will be in the new organization, however. Before a stint as a top Republican congressional healthcare aide, Kahn had served as the HIAA's second-in-command to former chief executive Bill Gradison.
Kahn has angered top Republicans on Capitol Hill because he has been critical of their plan to extend drug coverage to seniors by helping them purchase private insurance coverage.
Ignagni, meanwhile, has found herself on the same side as Republicans on Capitol Hill as her organization has fought managed-care reform legislation consistently for the past several years.
Officials from both organizations declined comment.
The merged organization has the potential to become one of the most fearsome lobbying groups in Washington.
"They can focus more resources on a single position," said Randy Fenninger, who lobbies for urologists and other physicians. "I think that makes them a more formidable presence than they've already been. Anyone who opposes them on any issue has to take that into account."
The AAHP represents more than 1,000 HMOs and other managed-care plans, while the HIAA represents 294 companies, including both managed-care and traditional indemnity plans.
As a merged organization, AAHP-HIAA would become one of the largest healthcare interests in Washington. The HIAA had 1999 revenue of $18.2 million, and the AAHP had $25.1 million the same year, according to the two organizations' filings with the Internal Revenue Service.
The AAHP formed in 1959 as the Group Health Association of America. It took the name after the GHAA merged with the American Managed Care and Review Association in 1996.
The HIAA formed in 1956 with the merger of the Bureau of Health and Accident Underwriters and the Health and Accident Underwriters Conference.