Collaborating Authors

Healthcare Earnings: Anthem (ANTM), Aetna (AET), Humana (HUM), Cigna (CI) Still Figuring Out How To Profit Under Obamacare

International Business Times

UnitedHealth Group, which made waves Tuesday when it announced it would exit most Affordable Care Act health insurance exchanges in 2017, is hardly the only company in the healthcare industry that has not yet developed a recipe for guaranteed success in an Obamacare world. Other major insurers -- Cigna, Anthem, Humana and Aetna -- are in the midst of proposed mergers that have generated controversy and drawn scrutiny, even as the companies themselves say the mergers are necessary for better business and quality of care. These companies are scheduled to report earnings starting next week, and analysts expect to see top-line growth, but flat margins, as these companies continue testing new strategies to generate profit in a sector undergoing significant upheaval. "We don't know if they're actually making money on certain segments of the business," Dustin Eggers, a principal at Decision Resources Group in Chicago, said of health insurers that are selling plans on Affordable Care Act exchanges. There are a lot of issues with that population," he pointed out.

Two major healthcare mergers could be in trouble amid competition concerns

Los Angeles Times

Two major health insurance deals that would reshape the industry's landscape -- Anthem Inc.'s purchase of Cigna Corp. and Aetna Inc.'s deal to acquire Humana Inc. -- appear to be in trouble amid concerns they would reduce competition. The Justice Department, which has been reviewing both transactions, is preparing lawsuits to block them, Bloomberg News and the Wall Street Journal reported Tuesday. A decision whether to file the suits could come as early as this week, and the companies could fight in court or agree to settle, the reports said. A Justice Department spokesman declined to comment. Shares of the four companies fell 2% to 4% on Tuesday.

FOX BUSINESS: Justice Dept. blocks two health insurance mega-mergers

FOX News

The Department of Justice (DOJ) doesn't get healthcare? That's the word from Anthem (ANTM) after antitrust officials announced the intent to block its planned 48 billion purchase of Cigna (CI), as well as Aetna's (AET) planned 34 billion purchase of Humana (HUM). The DOJ filed the lawsuits on Thursday, alleging the mergers would badly hurt competition in the industry. In a mid-morning press conference, U.S. Attorney General Loretta Lynch said if the deals were to proceed, American consumers would suffer. "They would leave much of the multi-trillion dollar health insurance industry in the hands of three mammoth insurance companies, and restricting companies, and restricting competition in key markets," she said.

Feds sue to block two giant health insurer mergers, fearing cost hike, care decline

The Japan Times

WASHINGTON – The U.S. government is suing to stop two major health insurance mergers, a move regulators say is needed to protect Americans from potential cost hikes and lower quality care. The Department of Justice said Thursday that the combinations of Aetna and Humana and Anthem and Cigna would hurt competition that restrains the price of coverage and reduce benefits, among other drawbacks. Aetna Inc. proposed last summer to buy Humana Inc. for 34 billion, while Anthem Inc. moved to acquire Cigna Corp. for 48 billion. The companies said Thursday they plan to fight the federal suit. Anthem, the Blue Cross-Blue Shield insurer, called it "an unfortunate and misguided" step backward for access to affordable care.

Cigna-Anthem Deal Could Raise Health Costs, Analysis Suggests

International Business Times

As questions mount over whether health insurer Anthem Inc.'s proposed 48 billion purchase of Cigna Corp. will win U.S. antitrust approval, an exclusive analysis produced for Reuters suggests the merger could lead to higher costs for large companies offering workplace medical benefits. More than 154 million people receive health benefits through employers, many of them large national corporations. The large employer market is a top concern for U.S. Department of Justice regulators reviewing the Anthem deal, company officials say. The government could block a deal if it finds evidence it would drive up the cost of such coverage. Anthem and Cigna, the nation's No. 2 and No. 5 health insurers, are among a handful of carriers selling national coverage plans to employers with thousands of workers across many states.