Aetna Buys Humana for $37B, What are the Consequences?

Health insurer Aetna Inc. said it would buy smaller rival Humana Inc for about $37 billion in cash and stock, in the largest ever deal in the insurance industry.

The bigger the insurer, the more power it has negotiating prices and improving its doctor networks.

Antitrust authorities, who were aggressive in their review of the failed deal between Comcast and Time Warner Cable, are expected to scrutinize how the combination of insurers will affect competition for each line of insurance: Medicare, Medicaid for the poor, individual insurance, commercial insurance for small and large businesses and the large employer business.

Aetna said the combined company is projected to have over 33 million medical members, based on memberships as of March 31. Operating revenue is expected to be about $115 billion this year, with approximately 56 percent from government-sponsored programs including Medicare and Medicaid.

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Maya Haynes is a dual-degree student Boston University in Boston, Massachusetts with majors in sociology and public health, and a contributor to Medical Groups. She is committed to making sure vulnerable populations in the United States are provided with the knowledge and resources to best plan and care for their families. She regularly volunteers at local preschools and community centers to assess the needs to of the populations she plans on serving.