A federal decide has dominated that Aetna wasn’t being truthful when the well being insurer stated final summer season that its choice to drag out of most Obamacare exchanges was strictly a enterprise choice triggered by mounting losses.
U.S. District Decide John Bates concluded this week that Aetna’s actual motivation for dropping Obamacare protection in a number of states was “particularly to evade judicial scrutiny” over its merger with Humana.
Aetna pulled out of Obamacare exchanges in 11 states final August, together with 17 counties in Florida, Georgia and Missouri the place the Division of Justice argued the merger would wipe out competitors.
That call to retreat from Obamacare got here only a month after the Division of Justice blocked Aetna’s $34 billion merger with Humana on antitrust grounds.
However Bates stated this week the DOJ introduced “persuasive assist” — together with inner Aetna emails — for the conclusion that Aetna () withdrew from the Obamacare exchanges in these counties “to enhance its litigation place.”
“The Courtroom doesn’t credit score the minimal efforts of Aetna executives to say in any other case,” Bates wrote in a ruling following a trial over the merger.
He added that Aetna’s choice concerning participation within the 2017 exchanges in these counties was “in truth manipulated.”
Aetna had warned the federal government it might must dump then-President Obama’s signature healthcare legislation if the U.S. scuttled its take care of Humana ().
“It is rather probably that we would want to depart the general public alternate enterprise solely…ought to our deal in the end be blocked,” Aetna CEO Mark Bertolini wrote in a letter to the DOJ final July that was obtained by the Huffington Put up.
Nonetheless, Bates stated it is clear that “Aetna tried to leverage its participation within the alternate for favorable remedy” from regulators.
The decide stated there’s “persuasive proof” that when Aetna later withdrew from the 17 counties in query, “it didn’t accomplish that for enterprise causes, however as an alternative to observe by way of on the risk that it made earlier.”
This critique was buried in a 158-page ruling issued by Bates on Monday, through which he blocked Aetna’s merger with Humana as a consequence of anti-competitive issues.
The ruling offers a giant blow to each firms at a time of nice uncertainty within the well being care business now that President Donald Trump has talked about rolling again a number of key provisions of Obamacare.
Aetna-Humana is not the one large well being care merger unsure. The DOJ additionally sued to dam the takeover of Cigna () by Blue Cross Blue Protect chief Anthem ( ) for anti-competitive causes.
Aetna declined to touch upon specifics of the opinion, together with the criticism from Bates, as a result of it is nonetheless “reviewing the small print.”
Final summer season, Aetna defined its choice to withdraw from most Obamacare exchanges by saying its particular person insurance policies enterprise had misplaced $430 million for the reason that exchanges opened in January 2014.
Nonetheless, the decide famous that Aetna saved its assist for exchanges in money-losing states like Delaware, Iowa and Virginia — however dumped Florida, despite the fact that that large state was projected to be worthwhile in 2016.
The ruling quoted an e-mail from Christopher Ciano, president of Aetna’s Florida market, to Jonathan Mayhew, head of Aetna’s alternate enterprise, displaying how shocked he was by the choice to depart Florida.
“I simply cannot make sense out of the Florida choice. By no means thought we’d pull the plug all collectively,” Ciano wrote, including that Aetna was “earning profits from the on-exchange enterprise.”
Mayhew responded by requesting to debate by cellphone “as an alternative of e-mail.”
Bates stated the response from the senior Aetna exec was an instance of Aetna’s “repeated efforts to hide a paper path about this decision-making.”