Psychiatrists Join Chorus Against Managed Care Mergers

Add psychiatrists to the list of healthcare professionals who are concerned that the proposed mega-mergers of Aetna and Humana, and Anthem and Cigna, will limit access to care. Announcements of the planned mergers came in early July, shortly after the US Supreme Court left intact the elements of the Affordable Care Act that allow subsidies for health coverage to low- and moderate-income households in all states.

The American Psychiatric Association on Thursday warned US antitrust regulators in a letter than large insurers already had a history of inadequate mental health networks and denying care, and the nation’s 36,000 psychiatrists had no reason to believe these mergers would make things better.

The letter was also sent to state insurance commissioners and attorneys’ general. Besides the necessary approvals from federal antitrust regulators, insurance commissioners in the states where the companies are based, or domiciled, will have large roles in shaping the outcome of these unions.

The American Medical Association, the American Hospital Association, and the American Academy of Family Physicians have previously asked anti-trust regulators to consider the impact of the mergers on competition.

Healthcare groups are just part of the opposition: earlier this week, several members of the Senate Judiciary Committee weighed in with their own objections. Leading the way was Senator Richard Blumenthal, a Connecticut Democrat whose state has more than a casual interest in the mergers.

“I am deeply concerned about these mergers because of the potential impact on competition and the concentration of power in fewer hands,” said Blumenthal, who has Connecticut attorney general brought an antitrust action against Microsoft in 1998.

Insurance regulators from Connecticut will have a unique role in these transactions, as they will oversee both an acquisition, if Aetna successfully buys Humana, and a sale, in which they will represent the rights of Cigna beneficiaries in the Anthem deal.

The Aetna-Humana union would also consolidate a large amount of Medicare and Medicaid contract work under one umbrella, and would account for more than half of the combined company’s book of business, according to figures provided at the time the merger was announced. With Medicaid managed care moving ahead in more states and an aging population seeking savings through Medicare Advantage, the public sector is an attractive market.

Indeed, the Kaiser Family Foundation said recently that the Aetna-Humana deal would put 26% of all Medicaid Advantage business under one roof. Aetna counters that’s still only 8% of the overall enrollment in Medicare. The problem is that the federal government wants to move away from fee-for-service into more value-based, alternate payment models—CMS has a goal of 30% reimbursements of this type in 2016—so it needs more beneficiaries in managed care, not fewer.

Both Democrats and Republicans on the Senate panel questioned whether the claims of benefits for consumers are real. Senator Mike Lee, Republican of Utah and chair of the antitrust subcommittee, said he wanted to know why “the insurance committee is rapidly consolidating.”