Health Plan Weekly

The Dept. of Justice (DOJ) on Nov. 12 joined attorneys general from four states in suing to block UnitedHealth Group’s proposed purchase of Amedisys Inc. Their complaint, filed in the U.S. District Court for the District of Maryland, alleges that the $3.3 billion deal would eliminate competition between two of the country’s largest providers of home health and hospice services.

The move comes just under two months before Donald Trump will be sworn in for his second term as president — an administration largely believed to be much more receptive to industry consolidation than the Biden administration has been. But one former federal antitrust official says there are reasons to believe the DOJ’s lawsuit against the UnitedHealth/Amedisys transaction might survive even when control of the federal law enforcement agency changes hands.

During the UBS Global Healthcare Conference on Nov. 12, Elevance Health, Inc. Chief Financial Officer Mark Kaye attempted to reassure investors that the company is on the right track despite recent struggles in its managed Medicaid business. However, he said the turnaround would take some time as the insurer works with states to increase reimbursement for treating a sicker pool of Medicaid beneficiaries.

“If I step back, 2025 is going to be a tale of two halves, with continued headwinds in the first half giving way to recovery in business performance and margins in the second half,” Kaye told UBS analyst A.J. Rice.

Reinsurance programs, which have largely faded into the background since the Affordable Care Act marketplace stabilized, are once again attracting attention.

First, a study published in March highlighted the unintended consequences of Georgia’s reinsurance program — and was soon followed by a piece from policy experts critiquing that study. And during the presidential campaign, Vice President-elect JD Vance brought up reinsurance as part of a pitch to revive high-risk pools in the individual insurance market.

With Donald Trump set to be the 47th president and Republicans in complete control of Congress, the fate of enhanced subsidies for Affordable Care Act exchange enrollees hangs in the balance. If these subsidies expire, there may be renewed talk of state-based reinsurance programs.

States can apply for and implement reinsurance programs via Section 1332 waivers of the ACA, which allow them to waive normal rating rules in order to pursue marketplace innovations. The programs work by subsidizing insurers’ highest-cost claims, allowing them to charge lower premiums overall. Between 2017 and 2024, 20 states have had Section 1332 waivers approved, according to CMS. Among them, 17 states operated state-based individual market reinsurance programs during the 2023 plan year.

Ending nearly a year of “will-they-or-won’t-they” speculation, The Cigna Group on Nov. 11 confirmed it is not pursuing an acquisition of Humana Inc., thus ending the possibility of a “Cigmana,” as some analysts called it.

In a press release outlining its capital priorities, the insurer emphasized its commitment to established merger and acquisition (M&A) criteria and said it “would only consider acquisitions that are strategically aligned, financially attractive, and have a high probability to close.” Cigna also affirmed its stock repurchase activity, noting it has bought back $6 billion worth of stock year to date and will continue into 2025, using proceeds from the pending sale of its Medicare Advantage (MA) business to Health Care Service Corp., which is expected to close in the first quarter of 2025.