More than one million Floridians covered by Humana and CarePlus health plans will not have to change insurance after state regulators on Monday gave conditional approval to a plan by rival Aetna to purchase the companies.
The Florida Office of Insurance Regulation, which reviewed the sale, will not require Humana and CarePlus policy holders to move to an unaffiliated company because of “its potential to disrupt quality of services, benefits, networks, and cost-sharing provisions,” according to the announcement. No transaction price was given.
Regulators also imposed conditions on the sale, which is part of a corporate merger between two of the nation’s four largest health insurance companies. Among the conditions are that Aetna expand its presence on the Affordable Care Act insurance exchange, also known as Obamacare, by entering five new counties by 2018 and providing a plan for statewide expansion by 2020.
For 2016, Aetna offers five plans on the ACA exchange while Humana offers 40 plans.
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Florida regulators also required as a condition of approval that Aetna agree to maintain “fair treatment” of individuals living with HIV, an agreement that Humana reached with the state in December 2014 after civil rights advocates filed a federal complaint alleging discrimination.
Humana and CarePlus combined are the largest Medicare insurers in Miami-Dade and Broward counties, with a combined coverage of more than 153,000 people.
Humana’s sale to Aetna is part of a corporate merger between two of the nation’s four largest health insurance companies. In Florida, the transaction will give Aetna ownership of Humana’s large stake in government-sponsored insurance programs, including Medicare Advantage and Medicaid managed care.
In reviewing the sale, Florida officials determined that the acquisition was not likely to lessen competition in the state or create a monopoly.
According to state reports, Humana earned $1.86 billion in direct premiums in 2014, including $725 million in Medicare Advantage, the company’s most profitable line of business and its largest with nearly 340,000 members.
CarePlus, a Medicare health insurance maintenance organization or HMO owned by Humana, also is profitable, earning $297 million in 2014, according to the state report, and covering nearly 98,000 people, mostly in Miami-Dade and Broward counties.
Humana is also a big player in Medicaid, where the company managed care for more than 326,000 people as of Sept. 30, according to state records.
Aetna’s purchase of Humana is still under review by the U.S. Department of Justice. The Florida Attorney General also is reviewing the sale. Huaman and Aetna shareholders agreed to the proposed merger in October 2015.