The health insurance industry will be watching and waiting to see if antitrust regulators approve several big insurance mergers, whether the Affordable Care Act's exchange market grows more sustainable, and whether states adopt new regulations governing provider network adequacy.
Looming above all those issues is the possibility of the election of a Republican president who would seek to jettison the ACA framework and replace it with an entirely different healthcare financing framework.
The U.S. Justice Department's antitrust division is reviewing Aetna's $37 billion purchase of Humana and Anthem's $54 billion deal for Cigna Corp. Aetna would become the largest Medicare Advantage insurer. Anthem and Cigna combined would create an even bigger powerhouse vying for employers' lucrative business. Centene Corp. is also buying Health Net in a $7 billion deal that would consolidate Medicaid health plans.
The Obama administration has halted several big corporate mergers on the grounds that they would have reduced competition and potentially driven up prices. In its final months, the administration may feel emboldened to heed the calls from provider and consumer groups to nix the deals.
On the other hand, experts say, Justice may OK the deals—albeit with requirements that the merged companies divest plans in some markets—because there are still so many other health insurers operating in most markets around the country. In addition, the administration could try to secure assurances that the merged companies will not stop selling ACA exchange plans.
“The government can use the merger approval to extract concessions it cannot otherwise force on insurers, so the government would waste an opportunity if it just flatly opposes the mergers,” said Erik Gordon, a healthcare business professor at the University of Michigan.