Mark Karlin, Editor of Buzzflash at Truthout
July 24, 2015
With the just-announced pending acquisition of Cigna Insurance by Anthem, the US will be left with three giant health insurance companies. This is unlikely to be a good development for consumers, to say the least. Market consolidation most often leads to fewer consumer choices, higher prices and more corporate profit. Any savings are rarely passed onto consumers.
What's worse for individual health insurance policy holders is that deductibles, copays and maximum out-of-pocket expenses will inevitably rise. Why? Because there will be fewer health insurance vendors to choose from, so the market becomes captive to health insurance companies that are "too big to fail."
The Associated Press (AP) reports about the massiveness of the acquisition of Cigna by Anthem:
The deal announced Friday is valued at $54.2 billion including debt. Shareholders of Cigna, based in Bloomfield, Connecticut, will receive $103.40 per share in cash and 0.5152 shares of Anthem stock for each of their shares. The companies put the total value at $188 per share.
AP notes that this announcement comes on the heels of "Aetna's $35 billion bid for Humana Inc. on July 3," and observes that "the landscape of U.S. health care has been altered in a buyout frenzy."