Massachusetts officials discussed Aetna leaving Connecticut during talks with General Electric

Boston Globe columnist Shirley Leung wrote last week that New England’s worst-kept secret was Aetna’s desire to get out of Connecticut and encouraged the insurance giant to relocate to Boston. The column made big news in Connecticut but Massachusetts officials have been hoping for an Aetna move for since 2015.

Emails between the Massachusetts officials who secured General Electric’s move to Boston show they also eyed Aetna as a company to lure away from Hartford in 2015, according to official state emails obtained by MassLive.com through a public records request.

Massachusetts Lieutenant Governor Karyn Polito emailed Jay Ash, secretary of housing and development, and chief of staff Steven Kadish, saying that it “would be nice to welcome more insurers” to Massachusetts.

The email was sent following Aetna’s response to Gov. Dannel Malloy’s 2015 tax increase. Aetna issued a statement that the tax increase was “damaging” to Connecticut’s economic future and would force Aetna to “reconsider the viability of continuing major operations in the state.”

The possibility of Aetna leaving Hartford has been a concern for several years. State and city officials worried that Aetna would leave Hartford if it was allowed to merge with Kentucky-based Humana but the planned merger was blocked in the courts.

With the merger effectively ended, worries about Aetna moving to neighboring Massachusetts have resurfaced as both the state of Connecticut and the city of Hartford face growing deficits.

Aetna, along with The Hartford and The Travelers Cos., pledged $10 million per year for the next five years to help the city of Hartford with its fiscal problems. Hartford still needs additional state funds in order to avoid bankruptcy.

Malloy has thus far refused to consider any major tax increases and proposed a reducing the tax rate on insurance premiums by .25 percent. This reduction is expected to save the industry $11 million next year and $22 million the following year, although it affects all insurers not just companies located here.

The idea has received support from insurance companies and the Connecticut Business and Industry Association. Malloy has denied the proposal is meant to keep Aetna to in the state but it wouldn’t be the first time the governor has made changes to tax proposals in an attempt to appease major business interests.

Massachusetts officials copied parts of a Hartford Courant article on GE’s search for a “big city in a growth oriented state,” which speculated that changes to Malloy’s tax increase were meant to “calm restive Hartford insurance companies Aetna and Travelers.”

Malloy cancelled some provisions of his 2015 tax increase, such as reducing an increase on the tax for data processing and online services. Ultimately, the changes were not enough to convince General Electric to remain in Connecticut.

In an email to Tim Cummings of the Marlborough Economic Development Corporation, GE government affairs manager James McGaugh called the situation in Connecticut “unfortunate” and “avoidable.”

“We communicated our views clearly and early on at the highest levels but they didn’t think we were serious. We are.”