Calif. approves Aetna deal; will Anthem’s get nixed?

Aetna’s acquisition of Humana is creeping toward the finish line, getting an approval early last week from one of California’s health insurance regulating bodies.

The insurer’s approval process stands in stark contrast to Anthem’s purchase of Cigna Corp., which has faced more publicized internal and external battles, and could be on its way to the chopping block.

Last week, the California Managed Health Care Department gave Aetna the thumbs-up for its $37 billion takeover of Humana, an insurer that has endured many obstacles over the past year and mostly covers seniors through Medicare Advantage. The department mandated Aetna make a few, relatively small concessions, such as investing $50 million in various healthcare projects; it has not yet weighed in on the Anthem deal.

Missouri is the only state thus far that has raised a stink over Aetna’s transaction, and many industry attorneys and analysts believe Aetna can placate state officials and the U.S. Justice Department by divesting some overlapping assets where insurance competition would be lessened. Still, many providers and consumer advocates have demanded both large mergers be stopped altogether.

Meanwhile, a Wall Street Journal article, citing anonymous sources, reports that Justice Department officials are not at all convinced Anthem and Cigna can alleviate their antitrust concerns. Regulators are worried the Anthem deal would lead to too much consolidation within the national employer market, where most Americans receive their health insurance.