Aetna CEO Denies Obamacare Pullout Driven by U.S. Merger Suitby
Bertolini testifies in U.S. trial against Humana merger
CEO says withdrawal from insurance exchanges due to losses
Aetna Inc. Chief Executive Officer Mark Bertolini defended the decision this year to withdraw from Obamacare markets, saying the move was driven by mounting losses and not the U.S. lawsuit against the health insurer’s planned takeover of Humana Inc.
In testimony Friday in Washington, Bertolini disputed that Aetna’s pullout from the insurance exchanges was triggered by the Justice Department’s case. The insurer was projecting losses of $800 million to $900 million in 2017 from the exchanges and had to do something “to stop the bleeding,” he said.
Bertolini took the witness stand as his company is fighting to save its $37 billion Humana acquisition. It’s one of two health-insurer mergers the Justice Department is challenging in a bid to prevent consolidation among the biggest U.S. players. The government says Aetna’s deal for Humana would reduce choice and raise prices for consumers, including those who buy insurance on the public exchanges.
About a month after the government sued to halt the merger, Aetna said it would stop selling individual Obamacare plans in 11 of the 15 states, including the three where the Justice Department said the Humana merger would harm consumers. The Justice Department says the withdrawal was simply an attempt to nullify that part of the government’s case.
On Friday, Justice Department lawyers tried to show that Aetna threatened the government with pulling out of the exchanges if the department sued to stop the merger.
During his testimony, Bertolini was asked about a phone call he had with Health and Human Services Secretary Sylvia Mathews Burwell about the merger. According to talking points prepared for Bertolini, a lawsuit would have consequences for Aetna’s Obamacare business if there wasn’t a “good path forward” on the deal. The company also told the Justice Department it would withdraw from the exchanges if it was sued.
Bertolini said the Justice Department letter was a response to questions from the government.
“I was trying to find any avenue I could to provide a positive result for the company,” he said about his discussion with Burwell. “It’s my job.”
The case is U.S. v. Aetna Inc., 16-cv-01494, U.S. District Court, District of Columbia (Washington).