NEW YORK – In another merger of health insurance giants, Anthem has agreed to acquire Cigna in a $54 billion deal.
The health services companies said that Anthem, Inc., a Blue Cross and Blue Shield insurer, would buy all of Cigna Corp.’s shares in a cash and stock transaction.
The deal is expected to close in the second half of 2016, if it passes state regulatory approvals and other requirements. The merged insurer would cover 53 million members.
The latest step in a striking consolidation of the insurance industry would leave only three major players.
Earlier this month, Aetna struck a deal to buy Humana for $37 billion, which would cover 33 million members.
The third remaining health insurer is UnitedHealth.
Experts say one factor driving the mergers is the Affordable Care Act.
Obamacare has meant more business for major insurers because more Americans have health coverage, but the law has also put more pressure on industry profits.
Some doctors are concerned that the mergers will put too much power in just a handful of insurance companies.
Bigger insurers with more clout could raise premiums and reduce the number of doctors and hospitals in network coverage plans. But health insurers have defended their position.
“This will actually improve efficiencies and reduce costs for consumers down the line,” said Cigna spokesman Matt Asensio.
Cigna is active in the U.S. and 29 other countries, primarily through employer benefits for ex-pats working around the world. Anthem serves customers in 26 states.
Cigna has been a big player in the employer market and has only dipped its toe into offering coverage through Obamacare exchanges. Anthem is a major presence in Obamacare plans.