Insurance regulators in at least two states are rethinking their approval of the proposed $16.4 billion merger of Anthem and WellPoint Health Networks, according to the Los Angeles Times. Georgia and Missouri regulators are questioning how their states would be affected by a WellPoint subsidiary's pledge to plow $100 million over 20 years into healthcare for California's poor and uninsured.
The promise convinced California's Department of Managed Health Care to approve the portion of the merger over which it has a say. However, state Insurance Commissioner John Garamendi, who has approval over another part of the deal, said no, and Anthem's challenge of his decision is pending in court.
Until now, California was the only holdup. All other states with authority over the merger and the federal government had given approval. But Georgia Insurance Commissioner John Oxendine said he has rescinded his approval until he knows where the $100 million for California would come from and how it would affect premiums in his state, the L.A. Times reported.
Missouri regulators, meanwhile, are examining whether the pledge is behind a request by the Missouri subsidiary of WellPoint to pay $10 million in dividends to its parent, the Times said.