Judge Derails Aetna-Humana Megamerger

In blocking the transaction, the court ruled that the proposed merger is likely to substantially lessen competition in the sale of individual Medicare Advantage plans in 364 counties.

Bates' ruling in the closely watched antitrust lawsuit largely agreed with objections in the government lawsuit filed by the Department of Justice and several states.

Regarding the looming decision of Indianapolis-based Anthem's proposed $54 billion acquisition of Bloomfield, Conn. -based Cigna, Randal Schultz, a partner at Lathrop & Gage and chair of the firm's healthcare strategic business planning practice group, tellsBecker's Hospital Review's Morgan Haefner: "I'll be shocked if the other case doesn't come down the same way".

Correction: Anthem (not Aenta) is awaiting a court ruling on its proposed purchase of Cigna.

Bates also spent a considerable chunk of the 158-page decision analyzing Aetna's decision, announced last summer, to withdraw its insurance plans from 17 counties where Aetna and Humana both sold plans on the public exchanges. Investors have always been skeptical that this deal can be approved, and Leerink Research analyst Ana Gupte reiterated on Monday that she expected to also see this deal blocked.

But Aetna said it was "giving serious consideration to an appeal after putting forward a compelling case".

Although Aetna is considering appealing the decision, that process could prove costlier than even that stiff breakup fee. He added that it would be hard, though not impossible, for Aetna to wait for Trump's new antitrust enforcers to be named and then strike a settlement to save the merger, perhaps by offering to divest more assets.

Bates found those arguments "unpersuasive".

Humana shares rose 2.24 percent, to $205.02 per share, when the stock market closed Monday.

Several big deals were torpedoed by antitrust regulators past year, including the $35 billion merger between oil-field service groups Halliburton Co and Baker Hughes Inc and the $6 billion combination of Staples Inc and Office Depot Inc.

A federal judge on Monday decided that a megamerger between insurance giants Aetna and Humana would likely cause more harm than good - at least from the patient's perspective.

"Today's ruling is a decisive victory for jobs, consumers, and healthcare". Medicare Advantage is supplemental insurance for Medicare recipients that covers services that Medicare doesn't.

Don't assume that the FTC under the Trump administration will simply approve every merger request that comes its way: its health-care agenda includes more competition in the health insurance market, especially in the Medicare Advantage market.

"We are disappointed by the court's ruling today".

Aetna-Humana isn't the only big health care merger in doubt. Anthem is expected to appeal; Cigna reportedly wants out of the troubled deal.

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