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Is Aetna Considering Relocating?

by | Jan 31, 2017 12:01pm
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Posted to: Business, The Economy, Financial Sector, Insurance, Jobs, Labor, Hartford

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HARTFORD, CT — If Aetna is considering a move to Boston, as is being reported by the Hartford Courant, the company is being tight-lipped about it.

“We don’t comment on speculation,” Matthew Clyburn, spokesman for Aetna, said Tuesday morning.

“We remain headquartered in Hartford, and we’re committed to our employees here, who continue to be an important part of our future,” Clyburn added.

The Courant reported that Aetna is considering a move to Boston and has been in discussions with Massachusetts Gov. Charlie Baker’s office regarding new a headquarters for many months.

Aetna has about 6,000 workers in Connecticut with the heaviest concentration in Hartford.

Democratic Gov. Dannel P. Malloy announced Monday that he plans to include a pitch to lower taxes on the insurance industry when he releases his two-year budget on Feb. 8. On Tuesday at an unrelated press conference he said that announcement was not specific to rumors Aetna might be looking to relocate.

Malloy declined to go into specifics about conversations he’s had with Aetna executives.

He said he’s spoken with Aetna President Karen Lynch within the past 10 days.

Malloy said Connecticut, like all the other states, is in competition for businesses.

“We’re going to compete. We do compete,” Malloy said. “And we have a lot of advantages.”

Last January, General Electric announced it was moving its headquarters from Fairfield to Boston. The high-profile loss of GE prompted Connecticut lawmakers and the governor to reconsider the state’s tax structure.

Aetna was one of the companies in 2015 who, along with GE, expressed concern about the tax package adopted by the Democratic majority. Malloy made changes to the tax package before agreeing to sign it that year, but it wasn’t enough to convince GE to stay.

Tuesday was a busy day for Aetna, as the company also reported quarterly earnings.

Aetna, whose $37 billion deal for Humana Inc. was blocked in court last week, reported higher-than-expected quarterly earnings Tuesday. The health insurer posted an operating profit of $2.92 billion, even though it lost $450 million on plans it offer in the individual marketplace under the Affordable Care Act.

The individual plan marketplace and other aspects of insurance are likely to change over the next few years as U.S. President Donald Trump and the Republican-led Congress move to repeal and replace former President Barack Obama’s health reform law, often called Obamacare.

Aetna, the No. 3 U.S. health insurer, is still deciding how to proceed on Humana, but analysts have said it’s unlikely the deal would go forward.

Moody’s Investor Services said the decision not to allow the merger to move forward was “credit positive” for the city of Hartford and the state of Connecticut.

Aetna is Hartford’s fourth-largest taxpayer and a top-10 employer in Connecticut. If Aetna were allowed to merge with Humana, which is based in Kentucky, it’s likely some of the jobs would be relocated or eliminated.

Aetna accounted for 3 percent of the capital city’s property tax base in fiscal 2016 and job erosion could increase vacancy rates, hurting the commercial real estate market and local economy.

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