Breaking News RE: Highmark and IBC Merger

[arnguy]

Highmark Blue Cross and Independence Blue Cross have withdrawn their proposed merger that was filed in April 2007 with PA DOI citing the fact that the DOI would require the merged entity to abandon the use of the "Blue Cross" or Shield" trademark as a condition for approval. This announcement came this afternoon just adys before the PA DOI was to announce its decision.

 

[moonlightandmargaritas]

Wow. Any idea why arn?

 

[arnguy]

Paul, one of the conditions for approval was alleged that the two Blues would have to give up their "Blue Cross" branding on the new entity. The Philadelphia Inquirer in an article this morning stated that this stipulation came from an unidentified source because nothing was official. The article also stated that the two Blues would be holding a joint meeting this afternoon. In any case, Joel Ario, PA Insurance Commissioner could not render his ruling until January 27th.

Subsequently, this afternooon the two Blues issued a joint statement that such a stipulation was unacceptable and that they are withdrawing their application. Ario then released a statement after the formal withdrawal that he "welcomed" the withdrawal inasmuch as he was prepared to deny the merger on the 27th.

Full information is available on www.ifawebnews.com which
covers insurance news in MD/DC, NJ, NY, PA, and VA as well as nantionally. Just click on the PA header for the full stories. I'll bet Aetna and United Healthcare are overjoyed. Personally, I am pleased because Highmark, in my opinion, is rapacious---devouring the smaller Blues in PA (Capital BC and BC of NE PA) with which they directly compete. Highmark owns the Blue Shield brand statewide and had a 10 year non-compete agreement with IBC.
- - - - - - - - - - - - - - - - - -
I received the official withdrawal notification from Independence Blue Cross this evening together with attachments showing the group letter and the news release.

BTW, Paul, I saw that the temperature was 38 degrees this morning in Tampa. If you need some warm clothing let me know.

 

[JMO Fan]

The supposed (but false) reason was reduction in competition. The US Justice Department had already said that was false -- twice! Considering the national Blues association requirements, it was impossible.

Pennsylvania loses, politicians win. :(

 

[arnguy]

Interestingly enough, in today's Philadelphia Inquirer a business columnist pointed out that the four Blue Cross plans in PA have a combined market share of 58% while the total share of Aetna, Coventry Health Care, and the UPMC (University of Pittsburgh) Health PLan combined[the three biggest non-Blue competitors] in PA is 17.9%.

 

[moonlightandmargaritas]

BTW, Paul, I saw that the temperature was 38 degrees this morning in Tampa. If you need some warm clothing let me know.

You know arn, it's been as cold as a dead witch's tit in the Klondike the last couple of mornings. I won't even go out of the house 'til the afternoon. Brutal wind straight out of the north as well - had to break out my seldom-used leather jacket!

Hopefully the worst is behind us! It warmed up in to the low 70's this afternoon (Friday). Like to have some nice weather for the Super Bowl visitors that are spending a boatload of $$$...