(COMMON DREAMS) Sarah Lazare — The health insurance giant Anthem announced Friday that it is buying its behemoth rival Cigna for $54.2 billion, launching the largest such merger the country has ever seen and reducing the number of major U.S. insurers to a paltry three.
Analysts and human rights campaigners warn that the move is poised to further slash access to healthcare and hike prices across the country, illustrating the problems with the for-profit model in terms of delivering vital services.
The mega deal comes less than a month after insurance giant Aetna acquiredHumana for $37 billion, part of a nationwide push to consolidate in what theWall Street Journal referred to earlier this year as an “oligopoly wave.”
The Anthem and Cigna merger is expected to be finalized in 2016, after which the joint company will provide coverage for at least 53 million people.
Numerous studies show that insurance mergers lead to higher premiums, including a 2012 analysis of a 1999 merger between Aetna and Prudential, as well as a report released in February which showed having more, not less, insurers in the insurance marketplace established by the Affordable Care Act leads to lower premiums.
Moreover, the mergers are taking place in a country that already has a dismal record with providing real care. A report (pdf) released last year by the Commonwealth Fund finds that the U.S. healthcare system is already the most expensive in the world yet delivers the worse care among 11 industrialized nations.