Aetna letter warned of Obamacare pullout if Humana merger blocked

aetna signAetna Inc. warned U.S. officials it might leave Obamacare public exchanges if its merger with Humana was not approved by federal regulators, reports show.

Per the Huffington Post, a July 5 letter from Aetna CEO Mark T. Bertolini told a U.S. Department of Justice official what was coming: “Finally, based on our analysis to date, we believe it is very likely that we would need to leave the public exchange business entirely and plan for additional business efficiencies should our deal ultimately be blocked.”

Bertolini said Aetna was losing money on public exchanges: “Our ability to withstand these losses is dependent on our achieving anticipated synergies in the Humana acquisition.”

DOJ and a number of states did oppose the merger, saying it could hurt competition and consumers. Aetna said this week it plans to exit 2017 Obamacare plans in Florida and all but four states.

Here’s a statement from Aetna today:

“Responding to a request from the Department of Justice, we provided in writing our views on the potential impacts to our individual public exchange business should the Humana transaction be blocked.  We indicated that there would indeed be an impact, which should not come as a surprise given a loss of deal synergies coupled with a potential break-up fee would raise further questions about sustaining a position in a business where we have yet to break even.  This loss of capital reserves would have an impact on other business segments as well.  We shared this assessment with the Department of Health and Human Services, which has oversight of the public exchanges and therefore should be informed of potentially significant actions related to our exchange presence.

“In the time since we submitted our written response to DOJ and provided a courtesy copy to HHS, we gained full visibility into our second quarter individual public exchange results, which – similar to other participants on the public exchanges – showed a significant deterioration.  That deterioration, and not the DOJ challenge to our Humana transaction, is ultimately what drove us to announce the narrowing of our public exchange presence for the 2017 plan year.  If the Humana transaction is eventually blocked, which we don’t believe it will be, the underlying logic of our written response to DOJ would still apply with regard to the public exchanges where we will participate in 2017.”


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