Health Insurance Mega-Mergers: Obamacare Proceeding as Planned

Cigna logo on the Cigna headquarters building

The latest announcement came Friday when Anthem Inc. announced it agreed to acquire rival Cigna Corp. for $48.4 billion. If approved, the new insurance giant would have an estimated revenue north of $115 billion and serve the health needs of more than 53 million people.

The Anthem-Cigna news comes on the heels of another mega-merger announced earlier this month, when Aetna Inc. agreed to buy Humana for $37 billion.

A new wave of insurance mega-mergers is fueling fears that ObamaCare is crushing competition. Despite initial claims that the law would bring down costs, Republican critics and others say it’s driving the industry to consolidate — which could end up costing consumers more.

“Without question, the enactment of ObamaCare has prompted increased consolidation in the health care industry,” House Judiciary Committee Chairman Rep. Bob Goodlatte, R-Va., said in a statement Thursday, announcing hearings on health care industry competition.

The concern, growing rapidly, is there may only be a few powerful operators still standing while smaller players are driven out of business. The billion-dollar deals accelerated following the Supreme Court’s ruling that kept Affordable Care Act subsidies in place.[Sources: and]

Health insurance companies are merging. They must do so, in order to survive the increased costs imposed by all the mandates of the absurdly named “Affordable Care Act.”

How can this be? The people who pushed for this law condemned what they view as the evil of profit-making insurance companies. So how does pushing insurance companies to merge into one or two gigantic entities serve the interests of consumers, patients or anyone?

In a totally free market, companies merge because it makes them more profitable in meeting the demands of customers. There’s nothing inherently right or wrong about big business or small business. The only right or wrong is what customers demand in the free marketplace, and what enables business owners to make a profit.

Health insurance never was a free marketplace. Although profit was permitted, there were so many rules and regulations — via Medicare, Medicaid, state health insurance boards demanding coverage for various medical services, licensing laws which actually restrain competition — there never really was a whole lot of consumer choice.

The Obamacare law, as predicted, has driven what’s left of the private insurance industry to consolidate into one or two gigantic entities.

I maintain that this is precisely what advocates of the law wanted. No, it’s not a conspiracy. It’s simply the logic implied by all their arguments in favor of medicine as a right to be given, rather than a commodity to be purchased.

Most advocates of the “Affordable Care Act” wanted single-payer, socialized medicine. “Free” health care, upon demand, for everyone. They wanted to kill off the private health insurance industry (along with for-profit medicine) completely. They did not quite succeed in that. This is one of the things that Bernie Sanders, the socialist Democrat running for president, screams about as unjust.

But Obamacare enabled more people to become eligible for government medicine than ever before, which in a way makes sense, because government has been driving private insurers out of business. The more government stifles the free market, driving up costs and reducing or eliminating choices, the more it seems reasonable that government must provide health insurance and health care on demand.

But why not simply get government out of the free market, so people can figure out what they need without the command-and-control bureaucracy and the consolidation of government-enabled, gigantic insurance companies? Nobody argues for a market. They only debate the best form of communism or socialism, at least in health care. Earth to people: There is no “best” solution when it comes to socialism or communism. Those systems lead to despair and death, each and every time they’re tried.

If the politicians who voted for this law could not have outright socialized medicine, they settled for the next best thing: virtual single-payer medicine. And now that’s what we’re getting. Obamacare treats health care as universal coverage to be treated as a right, under the law. Once the government declares something as a right under the law, then there’s really no more private market any longer. There are just a couple of gigantic profit-making industries forced to comply with the command-and-control regulation structure coming out of Washington.

Instead of simply shutting down the insurance companies and taking over all health care decisions at a federal office in Washington (as Bernie Sanders might have done, or Joseph Stalin would have done), the Affordable Care Act made it impossible for private insurance companies to function as anything like a private company. This distortion in the marketplace existed before Obamacare; Obamacare mainly finished the job. That’s what’s happening now.

What does this mean in practice, for patients? Health insurance premiums will be higher than ever before. This will affect you directly, if you purchase your own insurance (most people do not); this will affect you indirectly, if your employer is forced to cut your pay, or perhaps cut your hours, so as to avoid paying for health insurance.

From the point-of-view of those who supported Obamacare, this is all a good thing. It’s actually a two-fer. One, they can blast profit-making insurance companies even more. “Those evil, profit-making trusts!” Shut them down, and then Medicare/Medicaid will be the single-payer of all health care.

Two, the gradual twilight of health insurance as we know it means that the federal government can now push more and more people onto government care — Medicaid and Medicare, the latter of which everyone gets at age 65 anyway.

This is a win-win for progressives, because progressives are socialists. As for conservatives, they’re either clueless or do not care. Even Donald Trump, who does appear to care, has criticized Obamacare for not being socialist enough. Everyone is lost.

Insurance companies are simply doing what all private businesses seek to do, in order to survive. Band together when the going gets too tough to go it alone. In a free market, this happens when a business starts to lose its customers. In the health care situation, it’s happening because the government has prevented the health care field from even operating as a marketplace any longer. We imposed so many rules on health insurance and medical care that the market is starting to grind to a halt. Next stop: Single-payer. Unless or until we radically deregulate the whole industry and practice of medicine, what other option is there?

So problem solved, right? We’re not in single-payer insurance yet. But we’re just about there. What about the fact that Medicare is going broke by 2030 or so, according to Obama’s own Secretary of the Treasury?

No answer. Head in the sand. It will all work out … somehow.

Obamacare is systematically driving what was left of private health insurance, and non-government controlled medical care, out of business. Rest assured: Everything is going as planned.

Ultimately, the solution for this mess lies in the hands of health care providers, doctors, nurses and hospitals themselves. They will eventually have to opt out of government programs, as many are reportedly starting to do. But they will also have to find ways to make medical care affordable for patients and profitable for themselves at the same time. In other words, medical providers will have to leave the government behind — and demand, as a group, that the government leave them (and their patients) alone.

Until or unless that happens, nothing will change.


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