Judge blocks $54 billion Anthem-Cigna health insurance merger

By Carolyn Y. Johnson
February 8 at 9:10 PM - The Washington Post

A federal judge blocked the $54 billion merger between health insurance giants Anthem and Cigna on Wednesday, saying the deal would increase prices and reduce competition.

"The evidence has also shown that the merger is likely to result in higher prices, and that it will have other anticompetitive effects: it will eliminate the two firms’ vigorous competition against each other for national accounts, reduce the number of national carriers available to respond to solicitations in the future, and diminish the prospects for innovation in the market," U.S. District Judge Amy Berman Jackson wrote in a 12-page order.

The ruling follows a similar decision by a different judge to block the proposed merger between Aetna and Humana last month. Both deals would have transformed the health insurance landscape, consolidating the five largest health insurers into three big companies. The court decisions are a victory for the Justice Department, which sued last summer to stop both mergers.

Anthem spokeswoman Jill Becher said the company was reviewing the judge's decision and had no comment. A spokesman for Cigna did not immediately respond to a request for comment.

"Today’s ruling by the D.C. District Court confirms that the Department of Justice made the right decision in challenging the Anthem-Cigna mega-merger.  As a result, millions of Americans have been protected from higher insurance costs, fewer choices of providers and less innovation in health care delivery," said Rick Pollack, president of the American Hospital Association, in a statement.