California Insurance Commissioner Dave Jones pushed the U.S. Department of Justice to axe a proposed $54 billion merger between Indianapolis-based Anthem and Bloomfield, Conn.-based Cigna on grounds the acquisition would leave consumers with high premiums and diluted access to care, the Los Angeles Times reported.
Mr. Jones cannot block the merger on his own, but after studying past mergers and evidence discussed at a March hearing, the commissioner said the deal is "anti-competitive."
If an Anthem-Cigna merger succeeded, the resulting payer would control over half of California's insurance market in 28 counties, according to the LA Times.
"When it comes to the Anthem and Cigna merger, bigger is not better for California's consumers," Mr. Jones said.
Anthem executives said the merger would save $2 billion for the companies and help expand consumer coverage, the LA Times reported. Mr. Jones said Anthem did not say if those savings would trickle down to lower premiums.
In a statement to Kaiser Health News, Anthem expressed confidence that the merger will gain government approval. "We do not believe that the California Department of Insurance's opinion is based on the true merits of this transaction," the statement reads. "We are confident that the highly complementary nature and limited overlap of our organizations that will benefit the complex and competitive health insurance markets will be reviewed on the facts by the Department of Justices and appropriate state authorities."
In March, the American Medical Association warned Mr. Jones the merger could harm California's healthcare marketplace. In addition, leaders in healthcare and consumer groups have spoken against the Anthem-Cigna merger and a proposed Aetna-Humana merger.
This story was updated to say "Mr. Jones warned the merger could harm Californa's healthcare marketplace." The previous article said "Mr. Jones warned the merger could harm Californa's healthcare exchange."
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