In a high-profile antitrust case, a federal judge approved the planned acquisition of Change Healthcare Inc. by UnitedHealth Group Inc. on Monday, Sept. 19, but it was halted due to Justice Department intervention.
As bloomberg‘s Leah Nylen wrote on Monday afternoon: Monday’s decision by a Washington federal judge is a win for UnitedHealth Group, which has sought to diversify its business beyond insurance. The company plans to integrate Change, which operates a network used by doctors, hospitals, dentists and pharmacies to exchange and reimburse health insurance claims, with its Optum Insight data and consulting business. In a one-page order, his U.S. District Judge Carl Nichols ruled in favor of the merger, directing the companies to sell ClaimsXten to his TPG Capital as proposed. Modified shares rose more than 7% in early trading on Tuesday. UnitedHealth’s stock is little changed. ”
A UnitedHealth spokesperson said in an email that the company is looking forward to “integrating with Change Healthcare as soon as possible.” bloomberg.
As a Reuters staff report noted on Monday, “The Justice Department filed a lawsuit in February aimed at blocking an $8 billion takeover, and the deal would force the U.S.’s largest health insurer to divulge its competitors’ data.” The agency’s chief antitrust officer, Jonathan Cantor, said: “We are taking a close look at feedback to evaluate next steps. ‘ said. UnitedHealth said it will announce an all-cash transaction in January 2021 to help streamline administration and payment processes. Judge Carl Nichols on Monday rejected the government’s request to halt trading and ordered the company to proceed with the proposed asset sale. The order follows the hearing of a lawsuit he filed in August in the United States District Court for the District of Columbia. UnitedHealth said it was “satisfied with the decision” and looks forward to integrating with Change as soon as possible. The Justice Department said UnitedHealth and Change Healthcare provide competing software for processing medical claims, and together serve 38 of the nation’s top 40 health insurers. was saying The agency argued access to claims would give UnitedHealth a view into rival health plans, including Humana (HUM.N), Anthem and others. ”
The Reuters report continued: “The Justice Department’s loss follows the recent decision by a Federal Trade Commission judge that genetic analysis instrument maker Illumina should be allowed to buy cancer detection test maker Grail. It’s a move that authorities have opposed.” The department’s chief antitrust officer, Jonathan Kanter, said it was ‘we are reviewing the comments closely to evaluate our next steps.'” rice field.
monday evening, wall street journal‘s Anna Wilde Mathews and Brent Kendall report: The judge said he would publish an edited version of the ruling in the near future. In a one-page public order, he rejected the Justice Department’s request to block the company from completing the deal. Justice Department chief antitrust officer Jonathan Cantor said the department disagreed with the decision and was considering next steps. Quoting Kanter, they wrote, “Protecting competition and protecting access to affordable health care is of paramount importance to the antitrust department…and the Department of Justice.”
Further, Mathews and Kendall write: data. They said, “UnitedHealth agreed to sell business assets related to claims processing to address competitive concerns, but the Department of Justice dismissed it as insufficient. Judge Nicholls ordered UnitedHealth to I asked Health to sell it.”
Also, Mathews and Kendall said: Combined with Change, UnitedHealth claimed it could improve care and reduce waste by giving doctors better information. The company agreed to pay Change about $8 billion and assume about $5 billion of debt. The Justice Department argued that the deal would effectively monopolize an important tool health insurers use to determine when claims are paid. He also said the company should not be allowed to own Change Healthcare’s data clearinghouse, which rival insurers use to compete with his UnitedHealth. A judge appointed by former President Donald Trump expressed skepticism about the lawsuit at a hearing earlier this month. ”
as Mark Riley in Minneapolis/St.paul business journal July 29, “UnitedHealth first announced a deal for Nashville-based Change Healthcare in early 2021, seeking to integrate Change into its Optum health services division. It was the largest M&A deal announced by a Minnesota company last year, but federal regulators, along with the Attorneys General of Minnesota and New York, have filed lawsuits to block the deal. argued that it would give UnitedHealth too much insight into rivals in the insurance and medical technology sectors, hurting competition.
