Former AMA head opposes health insurance merger

RENO - The past president of the American Medical Association urged Nevada's insurance commissioner Thursday to deny the application by United Health Group, one of the nation's largest healthcare insurers, to buy Sierra Health Services, which operates Health Plan of Nevada.

Some say the merger could give United Health control of 80 percent of the market statewide, others say 28 percent.

Dr. Bill Plested said the company has "an unblemished record of putting profit before patients" and has been sued and fined in several other states for its practices.

He said he agrees the health care system is broken in the U.S., but that part of the problem is "the malignant, explosive growth of giant, for-profit companies" such as United Health.

But officials from the two companies told Insurance Commissioner Alice Molasky-Arman their goal is to provide more and cheaper health coverage by uniting. And they denied the merger would give the new company a practical monopoly over health care coverage in Nevada.

The comments were made during the third hearing on the merger application. Another is scheduled today in Las Vegas. Gov. Jim Gibbons requested the additional hearings after the initial one held in June, saying the issue was far too important to Nevadans who rely on the two health plans to cut testimony off after just one hearing. He said Arman must ensure her decision is what's best for Nevadans, not just for the companies involved.

To emphasize his concern, Gibbons attended Thursday's hearing in Reno. Arman will decide after today's Las Vegas hearing whether to close the filing. Once she does that, she has 30 days under Nevada law to render a decision on the application.

Plested and others, including Bob Fulkerson, of Progressive Leadership Alliance of Nevada, and Jon Sasser of Nevada Legal Services, said their figures show the merger would give United Health 90 percent of the Las Vegas area HMO market and control of 80 percent of the market statewide.

"We have serious doubts the proposed merger is going to be beneficial to Nevada consumers," Fulkerson said.

They argued that kind of dominance would give the company the power to force hospitals and doctors to take whatever discounts it demanded of them and to let United Health dictate medical treatment patients could receive instead of medical professionals.

Frank Collins of Sierra Health said those figures are not correct, that the merger would give United Health 28 percent of the statewide healthcare market and 35 percent in Southern Nevada. He said the market, which includes such companies as Sigma, Aetna, Anthem and Humana, would still be extremely competitive.

Forrest Burke, of United Health, said there would be no increase in rates and that reimbursement and other factors would be unaffected. He said initiatives by United Health such as evidence-based medical practices would reduce costs by up to 30 percent by reducing unnecessary treatments, prescriptions and reducing medical errors.

Peter Breen Jr., of Breen Insurance Services, said he believes the merger will provide more options for him to offer companies and individuals seeking benefits.

Diane Ross, executive director of The Continuum in Reno, told Arman she has extreme difficulty working with United Health. She said they called for help on an issue Wednesday "and we got Kevin in India."

Sierra Health Services, she said, has done a good job and she believes that would not continue if the company is absorbed by United Health. She said she recently had to reject a 14 year old who had suffered traumatic brain injuries because United Health limited the girl to just 20 treatments a year, demanding a 20 percent copay and a $1,500 deductible.

"We could not treat this child so we denied her," she said, her voice breaking.

There was also solid opposition by nearly a dozen nurses who work at Renown Regional Medical Center hospital in Reno. All expressed fear that United Health would begin dictating treatment they could provide to patients, endangering those patients.

• Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.