Because Highmark Inc. subscribers and Independence Blue Cross subscribers live on opposite ends of the state, the proposed merger of Pennsylvania's largest health insurers won't harm competition - as critics have feared.
That's what the two companies said in a massive filing posted online at 5:30 p.m. yesterday by the Pennsylvania Insurance Department.
The filings, submitted Friday afternoon, run to nearly 3,000 pages and include financial information about each company, organizational charts and links to past filings. Much of the information is duplicative. Both sides, for example, filed similar 11-page statements about competition.
"The two nonprofit corporations offer products in different geographic markets and do not compete with each other," the filings said. "Therefore, the combination of the two nonprofit corporations will not substantially lessen competition or tend to create a monopoly."
However, in a central Pennsylvania arc that stretches from Harrisburg to Allentown, the two Blues compete with each other and a third company for Medicaid managed-care business. The new company would have 78 percent of the market, substantially more than the third company's 22 percent share.
The companies say that Independence already offers Highmark's dental- and vision-insurance products as options for its customers. But, the filings say, customers can choose other dental- and vision-insurance coverage.
Doctors, hospitals, consumer advocates and competitors have voiced fears that the combination would hurt access to health insurance while squeezing reimbursements to doctors and hospitals.
The reports raise questions, despite their length. For example, there are references to off-balance-sheet financial relationships among Highmark and its subsidiaries. The filings say these have been disclosed to Independence in writing.
The same type of language also surrounds a paragraph on litigation: "Except as previously disclosed in writing . . . there is no suit, action, investigation or proceeding pending" affecting Highmark.