Judge Rules Against Anthem-Cigna Merger, Anthem Vows to Appeal
Saturday, February 11, 2017
Posted by: Bradley Coffey, MA, AAOE Government Affairs
Washington, DC and Indianapolis, IN - US District Judge Amy Berman Jackson ruled against Anthem's $54 billion bid to acquire Cigna ruling that the merger would adversely affect competition in the health insurance market. The ruling is similar to an earlier ruling against Aetna's $37 billion takeover of Humana.
The Department of Justice's Antitrust Division, to whom AAOE submitted comments in April 2016 opposing the mergers, successfully argued that the merger would stifle competition for large, multi-state employers in a market that is currently dominated by just four large insurance companies. Judge Jackson was also persuaded by the federal government's argument that infighting between the two parties (Anthem and Cigna) undercut their claims of savings from the deal.
Anthem and Cigna have been fighting with each other for over a year with Cigna going so far as to refuse to sign on to Anthem's proposed legal findings and undermining the insurer's savings claims in court, according to Politico. “The Department of Justice is not the only party raising questions about Anthem’s characterization of the outcome of the merger: one of the two merging parties is also actively warning against it,” Jackson wrote in her order.
Anthem has vowed to appeal the ruling announcing that it will "work aggressively" to complete its acquisition of Cigna. “Our decision to acquire Cigna is grounded in our commitment to this goal and to leading our industry during this period of dynamic change,” the company said in a statement. “If not overturned, the consequences of the decision are far-reaching and will hurt American consumers by limiting their access to high quality affordable care, slowing the industry’s shift to value based care and improved outcomes for patients, and restricting innovation which is critical to meeting the evolving needs of health care consumers.”
Anthem's timeline for an appeal is tight with the deal to acquire Cigna expiring at the end of April if the merger is not complete by then.