Merger trials: Aetna, Humana fight gov't over docs; Anthem-Cigna case split in two

Court

Though the trials for the two pending health insurer mergers are still more than a month away, they have been the subject of a flurry of pretrial motions and orders as the parties prepare to prove their cases.

Most recently, Aetna and Humana filed a motion seeking sanctions against the U.S. government, claiming “serious and prolonged discovery misconduct” on the part of the Centers for Medicare & Medicaid Services. The motion alleges that CMS has delayed sending documents regarding a central dispute in the case--how to define the Medicare market.

In its suit, the government claims the insurers’ deal will harm competition in the Medicare Advantage market, which it argues is distinct from traditional Medicare. But Aetna and Humana contend that the two should not be treated as separate markets.

“If the government is incorrect and traditional Medicare is a necessary component of the product market, its claims of anticompetitive effects will largely--if not entirely--collapse,” the motion says.

CMS’ failure to produce requested documents, the insurers say, has hampered their economic expert’s plans to perform an analysis that helps prove its case.

Therefore, the court should sanction the government by inferring that CMS views Medicare Advantage as part of the same product market as tradition Medicare, and by inferring CMS would approve the proposed divestiture of MA assets to Molina Healthcare, the motion says.

“It sounds to me like the insurers are overreaching,” Loren Kieve, a commercial litigation attorney in San Francisco, told the Hartford Courant. Another legal expert, though, told the publication that the motion showed the government was being “outgunned” by the insurers’ lawyers.

Meanwhile, in the Anthem-Cigna case, Judge Amy Berman Jackson issued an order to split the case into two parts. “The presentation of evidence will begin with the allegations concerning national accounts,” the order says, “before turning to the trial of the other issues.”

Jackson had said at a hearing Friday that she was considering splitting the trial into two parts--one to examine the deal’s effect on national markets, and another to examine its effect on local markets. Anthem’s lead lawyer seemed to welcome the move, saying “if we’re going to lose and we lose quickly, that’s better for everyone.”