The Antitrust Division in the U.S. Department of Justice told Blue Cross Blue Shield of Michigan that the AD would sue to stop BCBS from buying its main competitor in Lansing, Physicians Health Plan of Mid-Michigan. On Monday, BCBS called the merger off, according to the Antitrust Division.
Christine Varney, who heads the Antitrust Division, said the deal would have added a 20 percent market share to BCBS's 70 percent and "would have resulted in higher prices, fewer choices, and a reduction in the quality of commercial health insurance plans purchased by Lansing area residents and their employers" and given BCBS "the ability to control physician reimbursement rates in a manner that could harm the quality of health care delivered to consumers."
So far, the Antitrust Division under Ms. Varney has mostly okayed mergers but only after putting conditions on the approval. In January 2010, for example, the AD allowed Ticketmaster to purchase Live Nation while requiring Ticketmaster to accept restrictions on its future conduct.