Feds accuse Aetna/Humana attempting to derail merger challenge by blocking CMS defendants

The Department of Justice claims motions by Aetna and Humana to bar Centers for Medicare and Medicaid Services employees from  testifying in the upcoming merger trial and other court requests are an open attempt to derail its challenge of the $37 billion proposed deal.

The Department of Justice accused the insurers of filing motions in a "transparent attempt to derail the United States' merger challenge before the District Court ever hears from a single witness or reviews any evidence,"  DOJ Antitrust Attorney Peter J. Mucchetti said in Oct. 8 court documents.

Aetna and Humana want to stop the DOJ from calling any CMS employees as witnesses or even introducing any CMS documents into evidence, he said.

[Also: Aetna, Humana fire back at feds over DOJ attempt to block merger]

Barring CMS employees from testifying would deprive the U.S. District Court for the District of Columbia from hearing important testimony and evidence, Mucchetti said.

Trial is scheduled to begin Dec. 5.

The DOJ anticipates calling as a witness Richard Frank, MD, a special advisor to HHS Secretary Sylvia Burwell. Frank is expected to testify about the Medicare Advantage and Health Insurance Marketplace programs, including the differences between these programs and other health insurance offerings and how competition operates in these programs, Mucchetti said.

The insurers seek sanctions so that the court draws an adverse inference that CMS views Medicare Advantage as part of the same product market as original Medicare, Mucchetti said.

"Defendants' efforts must be viewed as nothing more than a ploy to shield themselves from evidence that original Medicare and Medicare Advantage are not part of the same relevant product market and that the merger is unlawful," Mucchetti said. "The insurers hope that a finding that Original Medicare is in the same product market as Medicare Advantage would cause the United States' claims to 'largely if not entirely collapse.'"

[Also: DOJ files motion to get hostile Anthem, Cigna letters]

The DOJ, in blocking the merger this July, has argued consolidation would stifle competition, while Aetna and Humana have said competition would remain in the Medicare Advantage and Medicare markets.

The DOJ is also asking for relief from court orders to produce additional discovery documentation. They have already turned over more than 1.4 a million records, according to court documents.

[Also: Court order filed to spilt Anthem/Cigna trial into two dates]

"The expansive forensic collection and review of millions of HHS documents on the expedited discovery schedule imposed in this case has far exceeded the bounds of reasonableness and the requirements for proportionality in this case," Mucchetti said. "Despite all of these difficulties, in addition to the data produced from DOJ's investigative file, the United States worked with HHS to produce substantial volumes of additional data and related material, including 2017 Medicare Advantage insurer bidding data, information on Medicare Accountable Care Organizations, insurer Medical Loss Ratio data, Medicare Shared Savings Program information, reports on Bundled Care Payment Initiatives, CMS brochures and publications on Medicare Advantage plans and benefits, ASPE reports on competition, beneficiary spending, Medicare Advantage Star Rating calculation methodology, and Medicare benefit offerings, and data underlying HHS reports on competition on the ACA exchanges, among other items."

Twitter: @SusanJMorse