Feds sue to block Aetna/Anthem deals

After more than a year of scrutiny, the U.S. Justice Department filed requests for preliminary injunctions Thursday to block the two health insurance deals led by Aetna and Anthem that would shrink the number of national carriers from five to three if allowed to proceed.

For the past year, Aetna has pursued its $37 billion acquisition of Humana to bolster its Medicare Advantage business. Anthem’s $53 billion bid for Cigna Corp. would consolidate health insurance administration offered to employers.

But federal and state regulators officially sued to block those deals, citing reduced competition and potential harm to American consumers.

“If allowed to proceed, these mergers would fundamentally reshape the health insurance industry,” Attorney General Loretta Lynch said Thursday during a news conference announcing the lawsuits. “They would leave much of the multitrillion-dollar health industry in the hands of three mammoth insurance companies, restricting competition in key markets.”

Aetna and Anthem each released statements saying they intend to fight for their deals. But the Anthem-Cigna tie-up appears to be on its deathbed, with Cigna expressing doubt of an approval.

“We do not believe the transaction will close in 2016, and the earliest it could close is 2017, if at all,” Cigna’s statement reads. Cigna disclosed […]

By |July 23rd, 2016|Industry News|Comments Off on Feds sue to block Aetna/Anthem deals

Physician, IT Workers Drive Hospital Jobs

Hiring by hospitals in recent years was driven by efforts to add physician and IT employees, according to a recent report by Congress’s leading Medicare advisors.

From 2010 through 2014, hospitals’ physician and surgeon employment surged 26 percent while employment of computer and math science pros jumped 18 percent, according to a recent report from the Medicare Payment Advisory Commission (MedPAC).

The MedPAC analysis of U.S. Labor Department statistics noted that the changes came during a period when overall hospital employment increased by 1.7 percent.

“Growth in the overall number of hospital-employed physicians suggests that hospitals have been more active in recent years in hiring physicians directly,” the report noted.

One indicator of the physician hiring trend was the finding that the number of physicians who are vertically consolidated with hospitals increased from 95,612 in 2007 to 181,787 in 2013, according to a Government Accountability Office report. That reflected the shift seen elsewhere, including a 2014 national survey by the Physicians Foundation, in which 53 percent of physicians self-identified as employees, compared with 44 percent who did so in 2012.

Regarding IT employees, the report stated: “Growth in computer and math science positions may reflect hospitals’ efforts to implement electronic health record systems.”

The federal electronic health […]

By |July 22nd, 2016|Industry News|Comments Off on Physician, IT Workers Drive Hospital Jobs

Study: Most insurers lost money in first year of ObamaCare

Only about one-third of health insurers came out ahead in their first year in the ObamaCare marketplace, according to a study by the Commonwealth Fund released Wednesday.

While insurers made nearly twice as much money from healthcare premiums in 2014, overall profits “diminished noticeably” because of higher payouts, according to the expansive new analysis on companies participating in the exchanges.

Overall, health insurers underestimated their total medical costs by about 5.7 percent in their first year.

About a quarter of insurers did “substantially worse,” underestimating their claims by an average of 35 percent. That means only a small fraction of insurers “fared especially poorly,” the report said.

Many companies recouped some of the money lost from ObamaCare plans with the help of the law’s reinsurance payments.

The reinsurance program, which is slated to end in 2017, makes payments to insurers with far higher-than-expected medical costs in their ObamaCare plans.

With reinsurance payments, medical claims were only about 2 percent higher than insurers had expected in the first year, the report said.
Researchers said the reinsurance program “played a crucial role in helping insurers transition” — and the federal government should consider extending the program until the ObamaCare marketplace “has matured.”
The analysis by then nonprofit Commonwealth Fund […]

By |July 21st, 2016|Health Reform|Comments Off on Study: Most insurers lost money in first year of ObamaCare

 

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