DC District Court judge to block Anthem-Cigna merger: report

Breaking News  Judge Amy Berman Jackson of the Federal District Court for the District of Columbia is expected to rule against the Anthem-Cigna merger on anti-trust grounds, sources have informed the New York Post. In anticipation of the appeal, Anthem has already filed an extension to the merger deadline from 31 January to 30 April, which Cigna is reportedly opposing in hopes of killing the merger.

The lawsuit was brought by the Department of Justice after Senate anti-trust subcommittee hearings and the displeasure of many state insurance regulators [TTA 21 July]. The hearing starting 21 November had two phases: the first on the merger’s effect on national employers, the second starting 12 Dec on local markets [TTA 21 Nov]. The huge stumbling block, according to the report, is Anthem’s unresolved conflict in a merger due to the ‘Blues Rule’, which requires that they have no more than one-third of its marketed products from other insurers in a state where they also market Blue Cross Blue Shield plans. Anthem is the licensee for Blue plans in 15 states, and according to court testimony by Anthem VP of corporate development Steven Schlegel, may have faced a $3 bn (£2.43 bn) penalty. This likely would have come from the Blue Cross Blue Shield Association, the licensor. Anthem’s hope reportedly was to transfer Cigna customers to its Blue plans to balance this out.

The NYP report also adds fuel to two years of rumors concerning governance and management succession conflicts between the two insurers. One revelation in the DOJ complaint was that in April 2016 “Anthem had established a separate, highly confidential team to work on integration planning without Cigna’s participation”. Earlier reports publicized that Cigna hoped that the DOJ lawsuit would have killed the merger; now Cigna wants no extension and to collect its $1.85 bn breakup fee. Sounds like a Fatal Case of Merger Remorse. Stay tuned. 

The separate Aetna-Humana hearing concluded on 30 December under a different DC District Judge, John D. Bates. Arguments here focused on overlaps in two areas: exchange policies (sold by Aetna in only four states, with overlap in 17 counties) and Medicare Advantage monopolies or near-monopolies. The judge’s ruling is still pending. Bloomberg, Hartford Courant, which lets hometown Aetna have its say.

Summertime, and the health data breaches are easy….

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2015/02/Hackermania.jpg” thumb_width=”150″ /]Cybersecurity is the word, not the bird, from South Korea (see here) to the US.  The week opened with an unusual healthcare plan supplier breach: 3.3 million payer records held by a card issuer, Newkirk Products of Albany, NY. The company issues ID cards for several Blue Cross and Blue Shield plans and provides management services to other commercial payers. Ironically, it was discovered five days after their $410 million acquisition by Broadridge Financial Solutions of Lake Success, Long Island. On July 6, Newkirk discovered ‘unauthorized access’ to a server with records containing the member’s name, mailing address, type of plan, member and group ID number, names of dependents enrolled in the plan, primary care provider, and in some cases, date of birth, premium invoice information and Medicaid ID number. “No health plans’ systems were accessed or affected in any way” according to the release. MedCityNews, Newkirk release on notice

Another supplier breach affected another estimated 3.7 million patients at Arizona’s Banner Health. This one was a bit closer to home, hacking computer systems used in payment processing on debit and credit cards used at their food and beverage outlets in four states between June 23 and July 7.  A week later, the hackers gained unauthorized access to systems containing patient information, health plan member and beneficiary information, as well as information about physician and healthcare providers. MedCityNews, Banner Health release

But what’s secret anymore about your health data anyway? It’s all those apps that are sending data via your Apple Watch and your Fitbit which aren’t necessarily covered by HIPAA or secure. (more…)