Highmark & Independence Blue Cross Merger

arnguy

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On Tuesday the feds gave provisional clearance for the two BXs to merge. In the PA state legislature,however, a bill giving the PA DOI the power to investigate the Blues and this merger in particular just passed the Senate and now goes to the House for a compromise final bill to be worked out. Because the Blues are considered nonprofit organizations, the DOI did not have jurisdiction on this merger proposal. If the merger finally receives state approval, the two companies will become the largest health insurer in PA and among the top 5 in the nation.:skeptical:
 
Should be interesting. UHC has very strong rates in Central Pa, but their policy is not up to par with BC.

What plans are you talking about in relation to UHC and BC. From the research I have done thus far, some of the HMO plans are good, but a lot of the BC plans have large holes.
 
An article in today's Philadelphia Inquirer regarding this topic stated that, Joel Ario, PA Acting Insurance Commissioner indicated that the earliest the state will rule on this matter is next summer. Both parties have been sent a list of 71 questions by the insurance commissioner's office. As of this past Monday they have received only 9 responses; however, one of the responses was 2,800 pages long. Currently they each control slightly over a quarter of the market. According to state documents, combined they would have a 53% market share. Aetna, their closest competitor has a 5.8% market share. Ario indicated the merger would benefit large employers but would not benefit small employers. What is interesting is that Ario is quoted as saying, "My review has convinced me that the current Pennsylvania market is not a stable one for small groups and iindividuals."
 
When the merger was announced, the insurance dept didn't even have authority to review it. The legislature belatedly granted some review authority, and now the dept is abusing it. This merger will be better for PA; so why does the acting insurance commissioner care?

It looks like a ploy to boost the insurance dept at BCBS expense. It seems highly unlikely that state govt is going to add any value to this transaction. Instead, they'll waste millions of subscriber insured dollars to analyze data, when even the dept admits it doesn't have the staff to review them.

Decision on health insurance merger at least a year away in Pa. - Philadelphia Business Journal:
Joel Ario, the department's acting commissioner, ... said the completion of the review "depends on numerous factors outside the department's control."
Those factors include ... obtaining experts to review the data and respond to issues raised during public hearings the department plans to hold -- but has not yet scheduled.
Acting commissioner, inadequate staff -- does this sound like a department that knows what it's doing?
 
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