Anthem-Cigna trial to begin next week: 9 things to know

U.S. District Judge Amy Berman Jackson will begin hearing remarks from Anthem and Cigna Nov. 21 as the payers defend their $54 billion acquisition contract against an U.S. Department of Justice antitrust challenge.

Here are nine things to know about the Anthem-Cigna case.

1. The DOJ and attorneys general from several states sued Indianapolis-based Anthem and Bloomfield, Conn.-based Cigna July 21 out of concern Anthem's purchase of Cigna would impede health insurance competition. In its lawsuit, the DOJ wrote competition between insurers like Anthem and Cigna ensures employers and individuals can purchase high-quality policies at affordable prices. However, "competition is now at risk," as the payers are competitors in 35 markets, and represent the only competitive insurers in some markets. 

2. In its response, Cigna admitted it competes with Anthem in the 35 areas pointed out by the DOJ in terms of reimbursement rates, customer service, wellness programs and provider collaborations in some cases. However, Cigna said it lacks information to support claims that large group employers would be harmed by the deal, stating "those responses can differ widely among a diverse set of large group employers in different areas and circumstances."

3. Anthem has argued the lawsuit "is an extraordinary action in which federal and state competition authorities, are, according to their own allegations, seeking to deprive American consumers of lower healthcare costs," according to the Hartford Courant.

4. In August Judge Jackson selected Nov. 21 as the trial's start date, with hopes to rule on the deal by the end of January. Judge Jackson said Anthem's requested Nov. 1 start date was too soon, and the DOJ's suggested Feb. 17 start date was too drawn-out.

5. The trial start date represented a setback for the insurers, as Anthem said its acquisition of Cigna will need to be complete by April 30, or Cigna will walk out the next day and collect a $1.85 billion breakup fee. In addition, Anthem said even if it receives a positive court ruling, it will still need at least 120 days to garner approval from all state regulators.

6. Anthem and Cigna have had their efficiency as one entity called into question, as each accused the other in September of breaching their $54 billion acquisition agreement. The DOJ's filing reads, "Governance disputes between defendants have escalated, and the firms are now accusing each other of breaching the merger agreement." The department said the letters the lawyers exchanged "reveal the current state of hostility between defendants," as well as accusations of agreement violations from both sides.

7. A federal court official recommended in early October correspondence between Anthem and Cigna be released, as the documents and emails may reveal the two insurers do not get along and would be ineffective as a single entity.

8. Approval of the Anthem-Cigna deal would establish the nation's largest insurer per enrollment, with more than 54 million policyholders, an annual revenue of $117 billion and national market share of about 29 percent.  

9. In Washington, D.C., next week Judge Jackson will begin determining if an Anthem-Cigna deal would hinder competition in the national insurance market. If deemed so, a preliminary injunction to block the merger could be issued. If not, Judge Jackson will begin hearing arguments about local market competition Dec. 12.

This article was updated on Nov. 17 at 12:15 p.m. CT to accurately reflect Judge Amy Berman Jackson's title. The previously article referred to Judge Jackson as "Ms. Jackson" on second reference as opposed to "Judge Jackson." We regret this error. 

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