Medicare patients in Colorado Springs should thank Colorado Attorney General Phil Weiser. He did exactly what The Gazette editorial board implores politicians to do. He fought for more competition to protect consumers from soaring prices.
The whole thing goes back to a story so boring few paid attention. Wade through it, because the outcome matters.
UnitedHealth Group pitched a $4.3 billion bid to acquire a physician practice group belonging to Denver-based DaVita. Nearly 90% of DaVita’s patients are on government-provided insurance, and the company receives 69% of its revenues from Medicare.
DaVita Medical Group, a DaVita subsidiary, owns two large physicians groups in the Springs. UnitedHealthcare, a subsidiary of UnitedHealth Group, serves as the region’s largest provider of Medicare Advantage plans.
Under the proposed merger, UnitedHealth Group subsidiary Optum — a physicians group — would have acquired DaVita Medical Group. It means the region’s major Medicare insurer would control one of the region’s major Medicare service providers.
“The combination of Optum and DaVita Medical Group would create significant market power with the ability and incentive to raise DaVita Medical Group’s price to other insurance companies that serve Medicare Advantage patients in the Colorado Springs Area. If left unchecked, the merger would result in reduced competition, higher health care costs, reduced benefits, and fewer choices for seniors,” explains Weiser, who met with The Gazette’s editorial board last week.
Incredibly, neither the Federal Trade Commission nor the U.S. Department of Justice Antitrust Division intervened in this anti-consumer consolidation. This is the same FTC and Justice Department that allowed recent anti-consumer mergers of CVS Health with Aetna and Express Scripps with Cigna, against the American Medical Association warnings of the consolidation raising drug prices by reducing market competition that was already scant.
As the last man standing between embattled consumers and two merging health care giants, Weiser — who calls himself “the people’s lawyer — filed suit in the District Court of El Paso County to demand enforcement of Colorado’s antitrust law.
The lawsuit brought all parties to the table to sign a consent judgment that ensures the merger won’t reduce competitive options for Medicare patients. UnitedHelathcare agreed to lift its exclusive contract with Centura Health for at least 3.5 years, which expands the network of health care providers serving Medicare Advantage patients. DaVita agreed to extend its agreement with Humana, UnitedHealthcare’s main competitor in Colorado Springs.
“I am committed to protecting all Coloradans from anti-competitive consolidation and practices and will do so whether or not the federal government acts to protect Coloradans,” Weiser said.
While we have policy disputes with our friend Weiser — particularly those involving his participation in at least eight lawsuits against the Trump administration — we can only applaud his dedication to preserving competition.