I'm glad you are ok! I think you did everything right.
Merging is a tough driving skill... and most ppl don't do it well, and those who are already on the main road don't bother to think about if any cars need to merge into their lanes, etc. I personally believe talking on the cell phone, whether holding it in the hand or not, should be illegal.
Every, and I mean EVERY near accident that someone involves me in, involves a party talking on the cell phone.
Don't worry about driving. You were very careful, and nothing bad happened. I know it's scary, but this is the price we pay for being able to drive. I would send a letter to your congressman urging the use of monies for ad campaigns against phone using and driving, if that's the way you also feel about it. We need to educate ppl in how it takes their mind from their driving. And, as you saw and told us, many ppl need all their mind they do have, just to drive!