Aetna, Humana Defend Merger

Dec. 08--Consumers may find fewer plans to choose between, but health giants Aetna and Humana said Monday they expect to save $1.25 billion by 2018 through their proposed merger and their combined expertise will help them serve customers better, company officials told Florida regulators in a hearing.

In some cases, the merger could reduce consumer choices, company officials acknowledged. For example, six Medicare Part D plans could become three within three years under rules that limit any one insurer's offerings, they said.

Overall, the combined companies are "highly complementary" with Aetna's extensive focus on commercial plans and Humana's expertise in Medicare Advantage plans, said Fran Soistman, Aetna's executive vice president of government services. The combination will help the companies remain "consumer-centric," he said.

Few specifics emerged, however, on whether efficiency savings might translate to lower consumer premiums.

"There are pros, but the overall con is whether it negatively impacts consumer choice," said Florida insurance consumer advocate Sha'Ron James.

Nor did company officials say much about possible job losses among the companies' 15,000 Florida employees. Soistman said employment in the state will "remain strong."

Aetna's presentation included a report making the case the merger is not likely to harm competition, saying the merged firm will still control less than 20 percent of the state's commercial market, for example. Humana is already Florida's largest Medicare health benefits company with more than 900,000 Medicare members statewide, so its lead there is on course to increase.

The hearing Monday in Tallahassee represents one of several state and federal reviews the merger must clear in coming months. Public comments remain open until Dec. 17.

A similar hearing for Anthem's deal with Cigna is set for Tuesday.

Measured by premiums, Humana and Aetna seem poised to become Florida's largest health insurance concern with more than $11 billion, based on a state summary using 2013 totals.

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