Anthem WLP +% and Cigna CI +1.95% on Friday morning announced a historic $54 billion merger that would make the new, combined company the largest health insurer in the country, by total customers.
The deal?s size is especially notable. (It?s the largest-ever merger in the insurance industry).
And the timing is remarkable. Just three weeks ago ? to the day ? rival insurers Aetna AET -0.89% and Humana HUM -1.09% announced their own mega-merger, a $37 billion deal.
If both deals get federal approval, America?s Big Five health insurers will be winnowed to a Huge Three.
So what happens next? And what will it mean for consumers?
Anyone who says he knows those answers isn?t worth trusting: America?s health care system is in uncharted waters.
First, there are real questions over whether either or both mergers will receive federal approval.
The Department of Justice was already scrutinizing the Aetna-Humana deal ? which now becomes the second largest-ever insurance industry merger ? before the Anthem-Cigna news broke.
Now, regulators will have to consider both deals together, and try and determine whether this unprecedented consolidation will be anticompetitive for consumers.
?They?ve never been faced with mergers of this significance,? David Balto, an antitrust attorney and former FTC official, told me on Thursday.
And ?when there are two deals of this size, you really end up in a hornet?s nest,? he added. ?I think there?s a pretty strong likelihood that these deals will be blocked.?
Of course, I?ve talked to folks who helped put these deals together, and they?re just as confident ? if not moreso ? that the mergers will get federal approval.
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