DOJ to appeal UnitedHealth-Change Healthcare merger challenge
In its antitrust challenge to a UnitedHealth Group-Change Healthcare deal, the Department of Justice argued that the merger would allow UnitedHealth to access a treasure trove of data on its competitors, which it could use to help its health plan arm, UnitedHealthcare, get ahead.
The feds want another shot at blocking UnitedHealth Group's acquisition of Change Healthcare.
The Department of Justice (DOJ) issued a notice of appeal late Friday, saying it would take the case to D.C. circuit court. In the brief filing, the DOJ added that New York and Minnesota would also join the legal challenge. UnitedHealth is based in Minnetonka, Minnesota, a suburb of the Twin Cities.
The filing did not specify any further details about the appeal.
UnitedHealth and Change won the right to proceed with their merger in district court in September and fully closed the deal Oct. 3. UnitedHealth has been integrating Change into its Optum subsidiary.
UnitedHealth Group said the appeal is "without merit" in a statement to Fierce Healthcare.
"After nearly two years of regulatory review, a full trial and a favorable court decision, we closed the transaction on October 3, and are executing on our vision to achieve a simpler, more intelligent and adaptive health system for patients, payers and care providers," the company said. "The appeal is entirely without merit.”
In its antitrust challenge to the deal, DOJ argued that the merger would allow UnitedHealth to access a treasure trove of data on its competitors, which it could use to help its health plan arm, UnitedHealthcare, get ahead. However, executives at UHG countered that the company already has access to such data at Optum, which provides multiplayer services, and to misuse that information would spell doom for critical business lines.
Federal Judge Carl Nichols wrote in his opinion that the DOJ's argument had "serious flaws" and noted that executives at major insurers like Cigna, Anthem and Aetna told the court that the companies would not become less innovative out of fear that UHG could poach their ideas. He also said that Change's agreement to sell of its claims editing business, ClaimsXten, would "restore the competitive intensity" lost in the merger.
Author: Paige Minemyer