Pennsylvania Blues Drop Merger Application

Critics of the combination have argued that it would reduce the level of competition in the Pennsylvania health insurance market.

Antitrust regulators at the U.S. Department of Justice have approved the combination, but members of the Pennsylvania Senate Banking and Insurance Committee recently voted 10-4 to send the Pennsylvania department a message urging it to reject the deal.

The Pennsylvania department told the companies that, if they combined, they would have to stop using either the Blue Cross brand or the Blue Shield brand.

“Throughout the review process, we have stated repeatedly that we would not give up one of our brands,” Dr. Kenneth Melani, Highmark’s president, and Joseph Frick, Independence Blue’s president, say in a joint statement. “We have spent more than 70 years developing our brands’ value in our markets and they are an integral part of our corporate identities and reputation.”

Rather than giving up one of the brands, Highmark and Independence Blue will move forward as “separate, financially stable, Pennsylvania-based companies,” Melani and Frick say.