ObamaCare blamed for insurer mega-mergers amid premium hike fears

[WestVirginiaRebel]

Fox News:

WASHINGTON – A new wave of insurance mega-mergers is fueling fears that ObamaCare is crushing competition. Despite initial claims that the law would bring down costs, Republican critics and others say it's driving the industry to consolidate -- which could end up costing consumers more.

 

"Without question, the enactment of ObamaCare has prompted increased consolidation in the health care industry," House Judiciary Committee Chairman Rep. Bob Goodlatte, R-Va., said in a statement Thursday, announcing hearings on health care industry competition.

 

The concern, growing rapidly, is there may only be a few powerful operators still standing while smaller players are driven out of business. The billion-dollar deals accelerated following the Supreme Court's ruling that kept Affordable Care Act subsidies in place.

 

Whether that's coincidence remains to be seen. But conservatives worry the health law, which requires companies to insure virtually anyone, puts pressure on firms to join forces. To survive, insurers must spread fixed costs over more customers. The bigger they are, the easier it will be to meet ObamaCare-imposed caps on operating costs and boost profits.

 

The insurance giants claim the mergers will let them operate more efficiently, but others see the potential for rising premiums.

 

"[ObamaCare] eliminates many of the essential competitive checks remaining in the American health care system," Christopher Pope, a scholar at The Heritage Foundation, wrote. "Because the law relies so heavily on unfunded regulatory mandates to finance the benefit structure, it is obliged to strengthen the power of incumbent providers to prevent targeted competition from eliminating their profit centers."

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If you like your merger, you can keep your merger...