The state’s top insurance official said she expects the state to voice no anti-competition objections to Aetna’s proposed acquisition of Humana.
Sharon P. Clark, commissioner of the Kentucky Department of Insurance, said that while the state review will not be completed until after a public hearing in the spring, she does not foresee any kind of competition problems in Kentucky as a result of the merger.
Aetna, based in Hartford, Conn., wants to buy Louisville-based Humana for $37 billion. Shareholders of both companies have approved the deal, but it still has to be reviewed by federal regulators and in each of the states in which the companies do business.
Clark said the companies have little overlap in Kentucky because Humana provides services largely to older residents, while Aetna targets mostly younger clients.
“I do not see a conflict here in Kentucky,” Clark told Insider Louisville.
The buyer in the deal, Aetna, has to provide the Kentucky Department of Insurance with two stacks of documents, a financial overview of the acquisition and a detailed set of information that includes products and market share.
Aetna filed the overview in early September and the details about three weeks later, Clark said, though it withdrew the detailed data about a week later because it had omitted some information.
Aetna refiled the detailed data last week.
Clark said she has hired two professors from Georgia State University — Robert Klein, director of the Center for RMI Research; and William Custer, director of the Center for Health Services Research — to review Aetna’s filing.
In the spring, the Department of Insurance will host a public administrative hearing, during which Aetna will give a presentation and the professors will represent the state. Consumers also can submit questions before the hearing.
The exact date has yet to be determined, Clark said, but it likely will happen during Georgia State’s spring break to allow the professors to participate.
Clark said the commission is required to approve the acquisition unless:
- it substantially lessens competition
- Aetna’s financial condition could jeopardize Humana’s health
- Aetna lacks competence or integrity to complete the acquisition
- it produces other circumstances that harm consumers
“Our utmost concern is always the policy holders,” Clark said.
However, she said, from the information she has seen, she does not expect Kentucky officials to stall the merger, which both companies have said they expect to complete in the second half of next year.
Information about how consumers can submit questions for the administrative hearing will be provided sometime close the meeting.
Click here to read about the federal review of the proposed Humana-Aetna deal.