September 11th, 2008

Reports the Pittsburgh Post-Gazette:

A company hired by the state to review the proposed health insurance merger of Pittsburgh’s Highmark Inc. and Independence Blue Cross of Philadelphia has found that “there is a distinct possibility that Highmark would enter southeastern Pennsylvania absent the consolidation going forward.”

That’s ammunition for opponents of the merger, who say the policy-holding public would derive greater benefits from direct competition between the two insurers than from a combination of the two, which would create one of the largest health insurers in the United States.

The group that conducted the study– LECG Inc., an economic and anti-trust consultant firm– said that the expected benefits of competition between Highmark and IBC would outweigh even the greatest possible benefits that Highmark and IBC claim would arise from their merger. The insurance department’s financial adviser company, Blackstone, also filed a report earlier this month.  Included is their view that the merger may make it harder for future competitors to enter the health insurance market in PA.

To learn more about LECG and Blackstone’s comments, check out an article in the Philadelphia Business Journal.

* * * * * * * * * * * * * * * * * * *

In other merger, news the public comment period has again been extended; to October 10.