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Aetna claimed this summer that it was pulling out of all but four of the 15 states where it was providing Obamacare individual insurance because of a business decision — it was simply losing too much money on the Obamacare exchanges.
Now a federal judge has ruled that that was a rank falsehood. In fact, says Judge John D. Bates, Aetna made its decision at least partially in response to a federal antitrust lawsuit blocking its proposed $37-billion merger with Humana. Aetna threatened federal officials with the pullout before the lawsuit was filed, and followed through on its threat once it was filed. Bates made the observations in the course of a ruling he issued Monday blocking the merger.
Aetna executives had moved heaven and earth to conceal their decision-making process from the court, in part by discussing the matter on the phone rather than in emails, and by shielding what did get put in writing with the cloak of attorney-client privilege, a practice Bates found came close to "malfeasance."
Source:
http://www.latimes.com/business/hiltzik/la-fi-hiltzik-aetna-obamacare-20170123-story.html
At what point does arbitrarily screwing with the healthcare of millions of people rise to the level of criminality?
(Score: 3, Insightful) by requerdanos on Tuesday January 24 2017, @11:31AM
The answer to this question probably isn't relevant to the discussion at hand, because of the word "Arbitrarily".
... And Aetna withdrew from those markets. A judge says they are lying and withdrew not because of losing money at all, but as "retaliation" for not being allowed to complete a merger.
Here's the thing: If Aetna was making money in those markets, then their withdrawl would punish Aetna, not the abstract merger approval/denial process. Companies don't generally say "Well if you don't let me merge then I am going to stop making bazillions of dollars. That will show you!"
I don't doubt that having their plan (perhaps a plan to not lose so much money on the ACA exchanges?) denied was a contributing factor in their decision to withdraw, but a judge with no financial stake has no valid opinion on whether the markets were making Aetna money. They either were, or were not. Judging from the fact that Aetna pulled out of those markets, it couldn't have been much money they were making, if any at all.
If I am losing money in a business venture, it would be a smart thing for me to *stop doing that* even if a judge pitches a fit over it. As much as I am not on the side of "big corporations", I do firmly think they should have the same right.
This doesn't look like an arbitrary screwing at all--if Aetna was making its money in those markets, they would not have withdrawn from them, merger or no merger.
(Score: 2, Insightful) by Anonymous Coward on Tuesday January 24 2017, @12:26PM
Here's the thing: If Aetna was making money in those markets, then their withdrawl would punish Aetna, not the abstract merger approval/denial process.
As a made up example: maybe they made 10M$ in those markets, but with the merger they were hoping to make 100M$. Betting 10M to earn 100M isn't that bad, so they started playing the poker/blackmail/whatever dance with the government; knowing both had a losing hand, but were hoping the other side would back down first.
If they already did a bunch of things to boost their bluff, it's very possible they crossed the point where they couldn't back down any more.
(Score: 2) by The Mighty Buzzard on Tuesday January 24 2017, @12:39PM
Nah, people are quite adept at saying something and then backing down. How many US celebrities have moved to Canada this year, for instance?
My rights don't end where your fear begins.
(Score: 2) by isostatic on Tuesday January 24 2017, @02:07PM
How's Hillary's cell?
(Score: 2) by The Mighty Buzzard on Tuesday January 24 2017, @03:51PM
See below [soylentnews.org].
My rights don't end where your fear begins.
(Score: 2) by https on Tuesday January 24 2017, @02:37PM
How many said they would?
Offended and laughing about it.
(Score: 1, Offtopic) by The Mighty Buzzard on Tuesday January 24 2017, @03:47PM
Oh, a dozen or so at least last I checked. I didn't commit their names to long term memory though. It wasn't important information.
My rights don't end where your fear begins.
(Score: 3, Touché) by https on Tuesday January 24 2017, @06:38PM
Bollocks. You admit checking more than once, and if they were celebrities their names were already in long term memory.
Lighten up. I won't think the less of you for saying "I make shit up because it makes my personal narrative seem plausible."
Offended and laughing about it.
(Score: 3, Informative) by requerdanos on Tuesday January 24 2017, @07:13PM
Below please find a list of 18 celebrities who said they would leave the US if President Trump was elected:
http://www.ibtimes.com/if-donald-trump-wins-presidency-these-18-celebrities-will-leave-us-will-canada-be-2440762 [ibtimes.com] (Recommendation: Block Flash to avoid video.)
FWIW, I didn't remember who any of them were, either. Popular destinations seem to have been claimed as Canada, Spain, Mexico, New Zealand, and Australia.
Even discounting those who said that they would move to a different planet (the singer Cher chose Jupiter), there's still a dozen or so in the public eye that were talking about leaving the USA and taking up residence in some other country.
I have been keeping an eye on the news, but haven't seen the reports of any of them moving yet, though of course it could still happen. But sorry, celebrities declaring they'd move--some specifically to Canada--if the president got elected is something that actually happened, not something that was made up.
(Score: 2) by Scruffy Beard 2 on Tuesday January 24 2017, @08:09PM
I have heard the immigration process takes up to 3 years. Watch for news in 2020 or so.
(Score: 2) by DannyB on Tuesday January 24 2017, @02:41PM
Prediction: one thing you will never hear from the Donald's lips: I was wrong.
Anything he says, he will stand behind it forever. Double down even. Admitting he might be wrong about something (like most people are from time to time) would be a sign of weakness and mean he is "a looser". (in his own mind)
To transfer files: right-click on file, pick Copy. Unplug mouse, plug mouse into other computer. Right-click, paste.
(Score: 0, Offtopic) by The Mighty Buzzard on Tuesday January 24 2017, @03:48PM
You're probably right. Offtopic but correct.
My rights don't end where your fear begins.
(Score: 0) by Anonymous Coward on Tuesday January 24 2017, @04:20PM
Offtopic but correct.
The person who lead the thread off-topic is now complaining that the responses are off-topic.
Geesus fucking kryst get a load of yourself.
(Score: 2) by AthanasiusKircher on Tuesday January 24 2017, @05:06PM
Agree that he won't say he was wrong.
But that's a different thing from "standing behind it forever." Or did you miss all those times in the campaign where he said one outrageous thing in the morning, but by the afternoon when the media came back and asked him, he'd claim he was misunderstood, or the media doesn't understand sarcasm, or even just blatantly claim he never said what he had previously said?
(Score: 0) by Anonymous Coward on Wednesday January 25 2017, @07:08PM
Two from just the last week:
I would have won the popular vote if it wasn't for the millions of fraudulent ballots cast.
The numbers of people at his inauguration as compared to other presidents.
You see him EVER changing his tune on either of those?
(Score: 1, Touché) by Anonymous Coward on Tuesday January 24 2017, @07:18PM
He is "a not as tight" in his own mind?
Seriously, "looser" [oxforddictionaries.com]?
(Score: 2) by DannyB on Tuesday January 24 2017, @09:26PM
Good catch! And I know better, but did it unthinkingly.
To transfer files: right-click on file, pick Copy. Unplug mouse, plug mouse into other computer. Right-click, paste.
(Score: 2, Informative) by Anonymous Coward on Tuesday January 24 2017, @05:20PM
How many US celebrities have moved to Canada this year, for instance?
I dunno, how many said they would?
But guess what, the week after Trump won, there were over 13,000 applications by Americans to move to New Zealand. [nzherald.co.nz]
That's 17x times the normal rate.
(Score: 2) by Scruffy Beard 2 on Tuesday January 24 2017, @08:13PM
The Canadian immigration website went down on election night due to the unexpected load:
U.S. visitors flooded immigration website prior to election night crash, department confirms [www.cbc.ca]
(Score: 2) by Nobuddy on Tuesday January 24 2017, @11:36PM
They are politely waiting their turns. Limbaugh, Beck, and Hannity have been holding up the line since 2008.
(Score: 2) by dry on Wednesday January 25 2017, @02:38AM
Radio just mentioned that according to Royal LePage, property searches from America are up 326%. Of course it is not that easy to immigrate with a couple of years queue and how many can actually afford to buy property...
I have heard of quite a few Canadians and holders of dual citizenship coming back. Though there is still the problem of finding a job and somewhere to live. It is amazingly cheap to live in America.
(Score: 2) by nobu_the_bard on Tuesday January 24 2017, @01:49PM
It could be mostly this article is true, but with the important detail they really did back out because they were losing money.
Perhaps this happened: They just used the threat of them backing out of Obamacare as a tool in another matter. When that matter didn't go as they wanted, they claimed they were following up on that threat, but actually they were going to back out regardless and were just trying to guilt-trip the gov't or something (maybe in hopes of getting another concession out of them, or some advantage in a future disagreement, or maybe even just because they were salty). Just because they made the threat didn't mean they were serious. People tend to forget the threats you don't follow up on if you don't publicize them, which is precisely what they did, threaten someone with an action and not publicize it. It takes a lot of data to see if someone does this kind of thing routinely, because you can't count on people noticing the pattern.
Just saying this theory doesn't seem inconsistent with the provided evidence, to my understanding.
(Score: 2, Interesting) by kurenai.tsubasa on Tuesday January 24 2017, @02:27PM
Meh. If you've ever come up against a religious or feminist objection, it's readily apparent that some people will reject a paying customer simply out of spite. I guess I don't find it surprising that there would be other reasons for businesses to refuse to do business. Anything else would be slavery.
(Score: 5, Interesting) by Whoever on Tuesday January 24 2017, @04:13PM
Except that that is exactly what Aetna did. They pulled out of profitable markets because they thought it better, long term, to punish the government for not allowing the merger, than to make the profit in those markets.
Clearly, this shows exactly why the merger should not go through: the benefit of the merger would be so great, it can only be through increased prices and reduced service to customers. This is clearly a merger that is anti-competitive and Aetna just proved it.
(Score: 4, Insightful) by sjames on Tuesday January 24 2017, @07:13PM
It's not at all unusual for a corporation (particularly one with large cash reserves) to make a move that costs profit in the very short term in the hopes of making a larger profit later. Further, it can hardly be considered punishment if they take the step voluntarily, especially when they also violate the law to do it.
For example, dumping. That is, selling below cost long enough to drive a competitor from the market.
In the case of Aetna, the judge found evidence that they were making money in those exchanges they withdrew from and then perjured themselves by claiming they weren't. Here's a key point, perjury is a crime.
(Score: 2) by requerdanos on Tuesday January 24 2017, @07:22PM
Thanks. I can't read TFA because they reject adblock users, which is fair enough, as it is their site and they may of course do what they like with it.
(Score: 3, Informative) by AthanasiusKircher on Tuesday January 24 2017, @08:07PM
In the case of Aetna, the judge found evidence that they were making money in those exchanges they withdrew from and then perjured themselves by claiming they weren't. Here's a key point, perjury is a crime.
While perjury is a crime, I don't believe the judge claimed that Aetna had actually committed perjury here. I skimmed the relevant sections of the ruling, and even TFA notes:
As for Aetna’s claimed rationale for withdrawing from all but four states, Bates accepted that the company could credibly call it a “business decision,” since the overall exchange business was losing money; he just didn’t buy that that was its sole reason.
It sounds like, at best, Aetna executives could be guilty of concealing relevant evidence during discovery or something, but I'm not sure there's an actual claim of perjury here -- just that the executives weren't telling the whole story (and the most relevant one for the counties in question for the merger).
Moreover, the judge did NOT find "they were making money in those exchanges they withdrew from." To the contrary, from the ruling (pp. 136-137):
The Court has no reason to doubt the financial information that Aetna presented, but it is not persuaded that this information explains why Aetna withdrew from the 17 counties identified in the complaint. The Court is persuaded that this financial information led Aetna to begin the process of rethinking and reducing its exchange footprint. [...] t is even possible that, in the absence of this lawsuit, Aetna might have considered whether to continue its exchange participation in some counties in Florida, Georgia, and Missouri. But the documents that team put together clearly show that they did not approach the 17 complaint counties as part of the business decision. Those three states were not mentioned in the draft documents before the request to include the 17 counties. And once those counties were included in the recommendation documents, they were a separate bloc not evaluated by the same business criteria (e.g., profitability) as the other markets. Hence, while Aetna puts on a persuasive case that information received in July 2016 changed the value proposition for Aetna participating on the exchanges generally, the Court nonetheless finds on the basis of all the evidence that Aetna’s decision with respect to the 17 complaint counties was not based on that value proposition.
Basically, what happened (as far as I can piece together from skimming the ruling) is this:
(1) Aetna was losing money in the exchanges, but it had previously displayed commitments to a strategy that it would make money long-term with them, so it continued to invest in them (and planned future expansion).
(2) Aetna became aware that it was losing much more than was expected in the exchanges, and it began plans to decrease its investment there.
(3) The prospect of the merger came along, but the DOJ threatened to block the merger, and Aetna threatened to pull out of the exchanges.
(4) After this discussion of the merger, suddenly areas in 3 states (17 counties) that hadn't been previously mentioned in the strategic plans to downsize the exchange investments were now added (and apparently not evaluated by the detailed criteria the other areas had been in the strategic plan). They were separated out in their own bullet point, and apparently leaving the exchanges there was not up for discussion (as opposed to the other parts of the downsizing).
(5) Aetna didn't present evidence that they considered profitability or non-profitability in these 17 counties, and THAT was the issue. Also, while I haven't read all the details, it seems that at best Florida may have been making some money (or at least some areas of it), though it's unclear from the parts of the ruling I skimmed whether that "profitability" had actually been attained or simply was expected to in the next year or two.
The judge therefore found that Aetna WAS losing money and WAS acting in part to protect its investments by downsizing. However, the judge also found that Aetna expanded its downsizing plan in specific ways after the merger discussions that don't seem to have followed the same procedure. And the new areas marked for downsizing not only were convenient for the merger but ALSO had been places Aetna was considering in expanding in anticipation of FUTURE revenues.
So, it's a lot more complicated than simply "Aetna perjured itself and lied." In fact, the ruling indicates that Aetna executives were forthcoming in sometimes surprising ways, even admitting in testimony that they were trying not to "make a paper trail" when discussing Florida. Rather Aetna basically took advantage of a strategic downsizing initiative that was apparently already underway to also facilitate the merger and improve its legal position.
(Score: 2) by AthanasiusKircher on Tuesday January 24 2017, @08:18PM
I just found the relevant passage in the ruling (p. 130). Of the three states in question (Florida, Georgia, and Missouri) that encompassed the 17 complaint counties, Florida was already profitable and expected to continue to be so. Georgia and Missouri were not profitable. The question of whether the states in question were profitable was not necessarily relevant to the ruling, only that the profitability criteria apparently were not debated in these newly added states... rather, they were just added to the list for leaving the exchanges. (Admittedly, leaving a profitable Florida entirely, rather than specific areas that were unprofitable or something, probably created more suspicion about this whole matter in the ruling.)
(Score: 2) by sjames on Tuesday January 24 2017, @10:13PM
The pages around that did state that Aetna left the exchanges to improve it's position in the lawsuit rather than due to profitability.
(Score: 2) by dry on Wednesday January 25 2017, @02:54AM
While perjury is a crime, it is very hard to get a conviction.
(Score: 2) by sjames on Wednesday January 25 2017, @08:31AM
Yes, it is. That doesn't make Aetna's actions any less slimy.
(Score: 2) by dry on Friday January 27 2017, @02:47AM
Yes, and at least here (Canada), miss-leading the court is also a crime that, while not as serious, is easier to get a conviction for and is sometimes pursued and perhaps should have been here.
(Score: 5, Interesting) by Zz9zZ on Tuesday January 24 2017, @08:02PM
I'm gonna go ahead and quote TFS:
Now a federal judge has ruled that that was a rank falsehood.
Your premise is flawed, and this next bit doesn't even make sense:
but a judge with no financial stake has no valid opinion on whether the markets were making Aetna money.
So the IRS is not equipped to audit companies because they don't have a financial stake? A judge can't review evidence and come to a decision? Let's drop this whole "post truth" bullshit where we assign Truth to reality based on our personal opinions. The judge is in a court of law, not a random internet forum...
From the report's conclusion:
Because Aetna’s withdrawal from the public exchanges in the 17 complaint counties was to avoid antitrust scrutiny, the Court gives that evidence little weight in predicting whether Aetna will continue to compete on the exchanges in the future
There you have the all powerful profit motive, a corporation engaging in political games in order to increase the chances of a successful merger and thus a greater monopoly on which to make profit. Simplistic logic like "they would only pull out of the market if they were losing money" won't fly, and ignores a lot of evidence that companies will harm themselves in the short term in order to win the long game. For another example, gas station franchises used to (still do?) save up a chunk of change so that they could offer below cost prices in order to drive their competitors out of business. A shady tactic aimed at reducing choice for consumers.
Don't presume to be wiser than a judge who has reviewed the actual case details, and don't presume that businesses are innocently just trying to make some money. The big bad government is looking out for the little people in this case, and insurance companies are one of the industries least deserving of any sympathy.
~Tilting at windmills~
(Score: 3, Insightful) by dry on Wednesday January 25 2017, @02:45AM
Companies leave markets all the time due to not making enough profit. For an insurance company, anything less then 10% or 20% is probably enough to force them to close up shop and concentrate their resources somewhere with higher profit margins. It's one of the things that pisses me off with industry, no longer happy to make a decent profit, it's gotta be a endlessly increasing profit so the CEO can make good on his/hers stock options