Updated 3:42 p.m.
The state’s top insurance official has approved the Aetna-Humana merger — without a formal public hearing that had been planned for this spring.
“We found no reason to deny or delay the approval,” Kentucky Insurance Commissioner Brian Maynard said in a statement to Insider Louisville.
Aetna’s proposed $37 billion acquisition of Louisville-based Humana has garnered significant national attention and is being scrutinized by the U.S. Department of Justice on antitrust grounds. The deal also has to be approved by the 18 states in which the companies operate. Aetna CEO Mark Bertolini said this month that the merger had been approved in seven states, according to the Hartford Courant.
While Kentucky’s immediate past insurance commissioner, Sharon P. Clark, told IL in October that she did not foresee any kind of competition problems in the state as a result of the merger, she was planning to hold a public hearing on the matter this spring. The hearing would have given members of the public an opportunity to voice their concerns.
Maynard, her successor, said he does not believe such a hearing is needed.
“Based on my office’s in-depth internal review, I felt no need to conduct a formal public hearing on the request, which would have resulted in additional expense being passed on to the consumer,” Maynard said.
“In this case, a hearing would have been an unnecessary formality,” he said. “We saw no reason to add additional costs to the process.”
Kentucky law states that the commissioner “shall approve any merger or other acquisition … unless, after a public hearing, the commissioner finds that” the merger would lessen competition or harm consumers.
A spokeswoman told IL via email that the law “requires the commissioner to approve a merger, unless the commissioner can prove at a public hearing that the merger does not meet the standards of (the law). After conducting the review of the filings, it was concluded that the merger met the standards of (the law.) Therefore, it could not be proven at a public hearing that the merger did not meet the standards of (the law.)”
Maynard’s order also states that his office believes no policy holders will be adversely affected and that the acquisition will not substantially lessen competition in Kentucky.
The spokeswoman said the department reviewed company information, market data and supporting documents, but would not release any without a public records request, which, she said, was standard procedure for financial documents of this nature.
The proposed merger, which has been approved by shareholders of both companies, has faced stiff opposition from consumer and medical groups, including the American Medical Association, the American Antitrust Institute and the American Hospital Association. The organizations said the merger would be bad for consumers. Even presidential hopeful Hillary Clinton has weighed in, saying she has “serious concerns” about the merger.
Maynard, however, said his office “concluded there would be no adverse impact on consumers.
“In fact,” he said, “all indications are that overall competition in Kentucky’s health insurance market is strong.”
Anyone who wants to appeal the order can do so within the next two months.