Aetna, Humana meet with feds as WellCare, Centene bid for MA assets

Amid fresh doubts about the Aetna-Humana deal, leaders from the two companies met Friday with federal regulators to make their case for consolidation. Meanwhile, two insurers have bid for the Medicare Advantage assets Aetna could divest if the deal closes.

During Friday’s meeting with Justice Department officials, Aetna touted its planned sale of MA assets as a remedy for antitrust concerns, noting that major industry players have shown interest in those assets, Reuters reports.

To that point, WellCare and Centene have placed competitive bids for a portfolio of Aetna’s MA plans that covers about 350,000 patients, according to another report from the news agency.

The potential deal, the article adds, would more than double the size of either Centene or WellCare’s respective Medicare businesses. However, those companies may not necessarily prevail if Aetna does in fact divest some of its MA assets, as other firms have also expressed interest.

Any divestitures, though, depend on the deal earning regulatory approval. That process has hit a snag of late amid reports that federal antitrust authorities were skeptical of the Aetna-Humana merger’s merits--as they have also been for the Anthem-Cigna deal.

The MA sector represents the main antitrust hurdle for the insurer merger, as a combined Aetna-Humana would be the biggest seller of private Medicare plans, the Wall Street Journal points out. Markets in Ohio, Florida and Missouri would face the greatest amount of overlap if the insurers merged--leading Missouri’s insurance commissioner to oppose the deal.

Also working against Aetna and Humana is the fact that DOJ officials have in the past viewed the MA market as distinct from that of traditional Medicare, despite the merging companies arguing otherwise, the article adds.

The uncertainty surrounding its merging rivals, meanwhile, have given UnitedHealth a boost in the stock market, another WSJ article notes. United is the only one of the “big five” insurers not involved in a deal.

- read the first Reuters report
- here’s the other Reuters article
- check out the WSJ article
- read the second WSJ report