Mega-mergers in health insurance: 10 steps to successful integration
When Aetna announced its deal to acquire Humana and Anthem followed with its plan to buy Cigna, the moves ushered in a new era of mergers in the US health insurance industry. The combined deals totaled around $90 billion in value, dwarfing anything the industry had seen and significantly raising the stakes for performance expectations.
Similar to most industries, healthcare insurance merger activity has gone through multiple distinct waves. A spate of acquisitions in the 1990s through the early 2000s sought to grow regional scale and lower administrative costs or to double down on more attractive (at that time) segments such as the individual market. In another wave of acquisitions in the late 2000s and early 2010s, the aim was to diversify insurance companies in the face of looming health reform. In yet another wave, national insurers acquired the largest Medicare Advantage and managed Medicaid platforms, once the essential elements of health reform came into focus.