The U.S. Justice Department today announced approval for the merger of Aetna and Prudential, creating the nation’s largest managed care company insuring one out of every ten Americans.

As a condition of the merger, the Justice Department did require Aetna to divest of health plans in Texas, where the company would have controlled more than 50% of the patients. But Aetna will still control a disproportionate amount of the market in other states, including over 50% in some parts of New Jersey, and still has onerous contract provisions, such as requiring doctors to accept all of the plans Aetna offers or none of them — the so-called all-or-nothing contract. This prevents doctors from rejecting plan provisions that they consider unethical if the physician wants to treat any Aetna patient.

Consumers For Quality Care, a health care watchdog project of the Foundation For Taxpayer and Consumer Rights, criticized the approval and called upon state regulators, who still must ratify the deal, to scuttle the merger.

“This is a black eye for an Administration that says it want to protect the public from HMOs that bully doctors, nurses and patients,” said Jamie Court, director of FTCR’s Consumers For Quality Care. “The new Aetna will have the bulk to downsize services, hike prices, and leverage doctors into accepting unreasonable contract provisions and reimbursement rates. Patients will suffer under this deal that signifies only a handful of managed care companies will be in control the nation’s health by the millenium. Patients and doctors will have less and less power to vote with their feet and the managed care oligopoly will be able to downsize the nation’s standard of care based on business, not medical, ethics. Our last line of defense against HMonopoly are state regulatory agencies, such as California’s, which must be urged to stand up to this bully for patients’ sake.”

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