'Inexplicable and irresponsible': Elizabeth Warren and other US senators are going after Aetna for leaving Obamacare
Elizabeth Warren, Bernie Sanders, and three other Democratic Senators sent a letter on Thursday to Aetna CEO Mark Bertolini questioning the motivations of the company in its decision to ditch 70% of their Affordable Care Act (ACA), better known as Obamacare, business.
Aetna said it was leaving the exchanges in August due to losses sustained through the ACA business. The day after the announcement, however, a letter from Bertolini to the Department of Justice revealed that the firm believed that if a proposed merger with rival Humana was blocked they would have to pull out of the exchanges.
In the letter Bertolini said that if the merger did not go through, they would pull back immediately from their Obamacare business. He also stated that if it did go through, the company would expand their ACA coverage.
The DOJ sued to stop the merger with Humana in late July. In its quarterly earnings report, a week after the DOJ's announcement, Aetna expressed concern over the future of its ACA business.
In the letter, the Senators noted that there was reason for the company to be wary of a possible DOJ lawsuit and the the $1 billion merger break up fee was a "expensive and risky bet on a highly uncertain outcome." By attaching a break up fee of that size to the deal, the letter argues, Aetna was attempting to force the DOJ's hand into approving the merger.
"Aetna's letter describes a dangerous and irresponsible bet that the Justice Department would not block the deal because Aetna has structured the deal in a way that would cause significant damage to itself and, by extension, to the public exchanges, if it was blocked," said the letter.
Bertolini noted in his Jul letter to the DOJ that if the deal was to fall through the firm would need to "recover those costs plus a break up fee" and litigation expenses.
Aetna has since said that the losses, not the lawsuit against the merger, were the primary reason for the Obamacare pullback but it did play a factor.
The Senators also pointed to a number of statements from Bertolini and Aetna that were in support of the sustainability and long-term commitment of Aetna to the Obamacare exchanges, saying that the company was supportive of the exchanges from a business perspective up until the merger was scuttled.
In a statement to Business Insider, Aetna spokesperson TJ Crawford said that the company is not the only one rolling back coverage from the exchanges and the letter is unfairly singling out Aetna. The statement reads:
"We are one of many insurers, large and small, that has been forced to reduce its public exchange participation due to an increasingly unstable marketplace. This isn't a recent development, as more than 40 companies exited certain geographies for the 2016 plan year.
Singling Aetna out may be politically convenient during election season, but this letter ignores realities and takes the focus away from needed reforms. The ACA is not sustainable without bipartisan action that improves access, affordability and quality of care for consumers."
In addition to Warren and Sanders, Senators Sherrod Brown, Edward Markey, and Bill Nelson signed the letter.
You can read the full letter to Aetna here (pdf)»