HARTFORD, Conn. (AP) — Whether Connecticut Insurance Commissioner Katharine Wade should have recused herself from overseeing the proposed merger of Anthem Inc. and Bloomfield-based Cigna will remain an issue facing state officials, despite a new federal lawsuit aimed at derailing the coupling of the two insurance giants.
The Citizens Ethics Advisory Board decided Thursday to proceed with issuing a declaratory ruling on whether Wade, a former registered lobbyist and government relations executive for Cigna, should have been permitted under the state’s code of ethics to regulate the industry and preside over the state’s review of the Anthem-Cigna merger. The ruling was requested by the government reform group Common Cause of Connecticut, which questioned whether Wade could be unbiased — an accusation Wade has denied.
Besides the board’s anticipated ruling by Sept. 30, state lawmakers will likely be asked to consider legislation to change the ethics rules governing public officials and possibly address appearances of conflicts of interests, something the board currently does not oversee.
“Once the declaratory ruling is issued, the board will likely have some directives,” said Carol Carson, executive director of the Office of State Ethics, adding how the board annually considers legislative proposals and submits them to the General Assembly. “It won’t surprise me, though we’re not there yet, to see something about appearances in this year’s ethics legislative proposals.”
Common Cause also plans to press for law changes. The legislature convenes in January.
The ethics board decided Thursday to push ahead with its ruling concerning Wade minutes after the U.S. Justice Department announced it was suing to stop the proposed Anthem-Cigna merger, saying the proposed combination would hurt competition. That prompted the Connecticut Department of Insurance to announce it was immediately suspending its review of Anthem’s financial condition and corporate governance.
The Justice Department also wants to stop the merger of Aetna and Humana. It’s now unclear whether the two proposed unions of health insurers will ultimately become reality.
Asked why the board was still proceeding with its review of Wade, Carson said it makes sense “to follow the regulations and to take the right steps going forward” given the uncertainty of the merger. She said “the board could determine that it is not going to go forward.”
Wade has argued that she “carefully and consistently followed the advice” of state ethics officials as early as February 2015, prior to her nomination as commissioner, “to make certain that under state ethics laws, I have taken all appropriate, legal steps necessary to avoid any potential conflict of interest with Cigna.”
But Barbara Housen, general counsel for the ethics panel, noted Thursday that while Wade had communications with her office, she never sought a request for advice in writing and “certainly never got a request to address a recusal in this whole merger process.”
Wade has taken various steps to avoid any conflicts of interest with Cigna, where her husband currently works as an attorney and where other family members have previously worked. She said she’s divested her interest in Cigna stock; recused herself on any matter involving Cigna in which she had direct involvement during her employment, which ended in 2013; put insurance-related stock she and her husband own in a blind trust; and ensured her husband is formally “firewalled” off from any dealings with her department.
But Democratic and Republican legislative leaders, the Connecticut Citizens Action Group, the Connecticut State Medical Society and the Universal Health Care Foundation have still publicly criticized her oversight of the state’s review of the merger.
“I believe my role has been grossly mischaracterized in the public arena,” Wade said in a written statement. “I welcome the opportunity to provide a thorough and accurate accounting of the process that I have undertaken to follow the letter of the state ethics law in order to carry out my duties as Insurance Commissioner.”
This story has been corrected to show the ethics board decision was Thursday, not Friday.