Is this why it’s called the “Show Me State”?

Federal regulators may ultimately approve the megamerger ofAetna and Humana, but theresulting insurance behemoth will not be welcome to do certainbusiness in Missouri.

In an order, John Huff, the director of the state department ofinsurance, said that if the merger is ultimately approved at thefederal level, Humana and Aetna will have to ceaseoperations in Missouri “with respect to the ComprehensiveIndividual, Comprehensive Small Group, and Group Medicare AdvantageMarkets.”

The department found that the merger would not be a problem fora number of other insurance products that the two companies offeror may offer, including large employer group health, lifeinsurance, property and casualty, large group employer health,small group employer health, and mini-meds plans.

In a Tuesday column for the St. Louis Post Dispatchurging the rejection of the deal, David Balto, an antitrustattorney, said that Humana, Aetna, and UnitedHealthcare alreadyaccount for 83 percent of Missouri’s Medicare Advantage market.

The proposed $37 billion acquisition of Humana by Aetna, which has been approvedby shareholders at both companies, is one of two enormous mergersbeing reviewed by federal regulators. The other is Anthem’sproposed $48 billion purchase of Cigna.

The Anthem-Cigna deal, reports the Wall Street Journal, isthreatened by squabbles between the two parties. Cigna officialsare worried that Anthem’s ongoing lawsuit against Express Scripts,the pharmacy benefit manager, over alleged overbilling, couldthreaten the merged company’s estimated value. Anthem officialsfeel the opposite is true.

Insurers have argued that mergers will allow them to becomebigger, meaner negotiators with providers, allowing them to deliverlower cost care for consumers. Many consumer advocates don’t buythe argument, saying that insurers will have little incentive todeliver low cost plans or high quality service to members with solittle competition.