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Commissioner's ties to Cigna raise ethics issues

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The close ties of Connecticut insurance commissioner Katharine Wade’s family to Cigna Corp., the giant health insurer, raised conflict-of-interest issues while she was in charge of deciding whether to approve the company’s proposed merger with Anthem. Her husband is a senior in-house counsel at Cigna.

And until 2013, Wade served as the Bloomfield, Connecticut-based Cigna’s vice president for public policy, government affairs and U.S. compliance, according to her bio on Linked­In. In her 21 years with the company, she worked primarily as a lobbyist. Until recently, she refused calls to recuse herself from the merger decision.

She announced that she would recuse herself Sept. 15, according to the Connecticut Mirror news site.

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The Connecticut Mirror reported earlier this month that attorneys in the Office of State Ethics were seeking to subpoena Wade’s personal financial information to help determine if she has a legal conflict of interest that might force her to step aside. Ethics office general counsel Barbara Housen asked for a formal hearing to compel Wade to answer Housen’s questions about whether she or her husband might profit from the merger, the Mirror says.

Wade’s husband, Michael, is associate chief counsel for service operations and litigation at Cigna. Among other things, he oversees a legal team of 40 people who analyze and respond to regulatory complaints nationwide.

Although Wade reported divesting her own Cigna stock, the Mirror reported that, as of mid-September, her husband still had unvested stock and options in the company. He has worked in the company’s legal department for 15 years.

In addition, Wade’s father-in-law works at a law firm that lobbies for Cigna, and her mother and brother previously worked at Cigna, according to a story in the International Business Times. As commissioner, she named a top deputy who worked at Cigna, and another longtime Cigna employee served as her agency’s counsel in reviewing the $54 billion merger deal.

That news site also reported that Connecticut Gov. Daniel Malloy decided to appoint Wade to the insurance commissioner post on the eve of the merger after Cigna employees, its lobbying firm Robinson & Cole, and Anthem donated more than $1.3 million to political groups affiliated with Malloy, including his gubernatorial campaign and the Democratic Governors Association, which Malloy chairs this year.

The advocacy group Common Cause had asked Housen’s office to rule on the conflict of interest question. And the Connecticut Citizen Action Group began circulating a petition asking the governor to replace Wade.

At first, Malloy and Wade declined to comment. Wade later said she had no conflict of interest but had decided to recuse herself from the Anthem-Cigna review process because the matter had been politcized.

But the ultimate decision may not even be up to Connecticut regulators. The U.S. Department of Justice filed an antitrust suit in July to halt the Anthem-Cigna merger, along with another one involving Aetna and Humana. The insurance companies are fighting the suit.


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