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Insurers' counteroffensive touts lower costs, sufficient choice

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Immediately following the U.S. Justice Department's July decision to fight the billion-dollar mergers of Anthem Inc. and Cigna Corp., as well as Aetna Inc. and Humana Inc., the insurers launched a counterattack.

In a joint statement, Aetna and Humana vowed to “vigorously defend” their union, which they hold would benefit consumers — particularly Medicare Advantage enrollees — with better-quality and lower-cost health insurance.

Aetna and Humana also took aim at the Justice Department's analysis, arguing there is enough competition in Medicare to support the merger, that Medicare Advantage and traditional Medicare do compete despite the Justice Department's assertion otherwise, and that divestitures would solve any competition

concerns.

Aetna Chairman and CEO Mark Bertolini added an exclamation point to the written statement in a CNBC interview, in which he said Aetna and Humana “are willing to take this (litigation) all the way to the very end.”

Anthem also pledged to fight for its merger with Cigna, and filed a response in the U.S. District Court for the District of Columbia arguing that the combination “will increase competition and result in cost savings, efficiencies and other benefits that will make health care more affordable and accessible to consumers.”

Anthem also said its takeover of Cigna would allow expansion of where it sells insurance through public health insurance exchanges.

Cigna, however, has recently played the role of the reluctant partner.

In an unenthusiastic response to the Justice Department's litigation, Cigna said it “is currently evaluating its options consistent with its obligations under the agreement” and doesn't believe the deal will close until next year at the earliest, “if at all.”

On Friday, however, Cigna President and CEO David Cordani downplayed the health insurer's stance.

Most industry stakeholders and other observers lauded the litigation.

“The prospect of reducing five national health insurance carriers to just three is unacceptable,” American Medical Association President Dr. Andrew W. Gurman said in a statement. “Given the mergers' potential to significantly compromise market competition, the AMA strongly supports the antitrust challenge from federal regulators.”

“The Department of Justice recognized that the health — both physical and financial — of the American people is at stake,” Topher Spiro, vice president of health policy at the nonpartisan Center for American Progress, said in a statement. The mergers “would have irreversibly transformed and destabilized the health care landscape at a critical juncture.”

But a spokeswoman for health insurance industry

lobbying group America's Health Insurance Plans said in a statement that “mergers among health plans can deliver significant benefits” and urged federal regulators to set their sights on “anti-competitive provider mergers and the soaring cost of pharmaceuticals driven in part by anti-competitive pricing tactics.”