The state of Missouri’s beef with the proposed $37 billion merger of Aetna and Humana does not appear to worry Joseph Swedish, CEO of Anthem, the company in the midst of an even bigger proposed merger with Cigna worth an estimated $48 billion.
The proposed merger is poised for approval from federal regulators, he told an investor conference reported by the Wall Street Journal.
Part of his apparent confidence, as explained by Anthem’s general counsel, Tom Zielinski, comes from the fact that the U.S. health care market is divided into 50 different state markets. Federal regulators, therefore, may be less inclined to view a merger as representing a potential national monopoly.
State insurance regulators will still be able to block mergers in their own states, as Missouri partially did on Wednesday, when it announced that it would not allow Aetna-Humana to operate in the individual health market or the Medicare Advantage market if that merger went through.
Swedish also dismissed rumors about tension between Anthem and Cigna officials as they approach regulatory approval from the feds.
“You would expect dynamic tension in terms of ultimately deciding what is best-of-breed — what parts do you keep, what don’t you keep, who leads what,” he said.
The Journal previously reported that Cigna brass was concerned about an ongoing lawsuit Anthem is pursuing against Express Scripts, the pharmacy benefit manager. Anthem claims the company overbilled it billions of dollars, and is seeking financial redress.
While Anthem contends that the suit is good for business and good for the merger, some Cigna officials have expressed concern about the legal battle dragging on or potentially ending badly for the plaintiff.
Furthermore, Cigna officials had expressed frustration in letters obtained by the Wall Street Journal about Anthem’s apparent lack of backup plan in the event that regulators did not approve the merger initially.
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