Do you remember back to last August where we were not in this insanity? Aetna was trying to strong arm the Obama Justice Department and FTC to approve their merger by threatening the exchanges by pulling out. One of the states that they pulled out of was Pennsylvania.
Back in August, I noticed something odd about Aetna’s rhetoric and reality in Pennsylvania:
Below is Aetna’s rate application memo for the individual market in Pennsylvania. You should look closely at the highlighted segment….
Aetna was profitable in 2015 in the individual market in Pennsylvania. It is projecting to be profitable in 2017….in all years Aetna’s individual market operations in Pennsylvania were either profitable or projected to be profitable.
That smelled fishy to me. Aetna did not get its merger approved.
And now there are lawyers involved. Modern Healthcare reports that the Allegheny County government pension fund is suing Aetna for a breach of their fiduciary duty:
The Allegheny County Employees’ Retirement Fund—an Aetna stockholder—alleges that Aetna’s retreat from the exchanges was not a “business decision,” as the insurer claimed, but a move to better its chances of closing a $37 million merger with Humana that ultimately failed.
The complaint, filed in Pennsylvania state court, says that Aetna’s alleged conduct, which came to light during its legal battle to acquire Humana, has caused the company financial harm and damaged its reputation. Moreover, the lawsuit claims that Aetna chose to forgo profits “simply to make good on their wrongful threats to the government.”
I am not a lawyer, but this looks to be on its face fairly juicy and straightforward for the plaintiffs. A blogger in a t-shirt and bunny slippers was able to pull the rate filings and call bullshit on the state rationale within hours of it being announced. I imagine that the very good lawyers that I am most likely no more than two degrees of connections away from will be able to use current public record from the anti-trust case and more sophisticated analysis than looking at screen shots to nail Aetna to the wall.