AMA applauds California commissioner for stand on mergers

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The American Medical Association distributed the following statement from its president, Andrew W. Gurman, M.D., on June 23.

The American Medical Association applauds California Insurance Commissioner Dave Jones for taking a strong stand to prevent a near total collapse of competition in the state’s health insurance market. He has taken the right approach to protect California by opposing the Anthem-Cigna and Aetna-Humana mergers.

The AMA agrees with Commissioner Jones that the mergers would very likely raise premiums above competitive levels and reduce the quality of health care. He was also right in finding that any efficiency savings achieved in the mergers would not likely be passed along to patients. His finding is supported by economic studies suggesting that health insurance companies use monopoly power gained from mergers to charge higher prices for health insurance.

The AMA commends the Commissioner for acknowledging the evidence physicians and others presented demonstrating that the proposed mergers would likely enhance market power or raise significant competitive concerns in most of California metropolitan areas. Last March, the AMA testified before the Commissioner and warned that granting anticompetitive market power to any health insurance company would have long-term consequences for California's health care delivery system that would threaten health care access, quality and affordability.