DOJ Settles Challenge of Geisinger Partial Acquisition of Evangelical

Geisinger and Evangelical reached a settlement agreement with DOJ in March 2021 after the DOJ filed suit in the district court of Pennsylvania, challenging agreements that include Geisinger Health System’s bid to acquire 30% ownership of Evangelical Community Hospital (ostensibly to avoid antitrust scrutiny) and other potentially anticompetitive conduct involving “significant entanglements” between the two parties. In the settlement, Geisinger agreed to reduce and limit any future ownership interest of Evangelical to a cap of 7.5%. Additionally, Geisinger is restricted from making any loan or line of credit associated with Evangelical, and from being involved in any decision-making in management or leadership positions at Evangelical. The parties also agreed to implement an antitrust compliance program.

Centene-WellCare Merger Approved by States and DOJ with Divestitures

After receiving regulatory approval from the U.S. Department of Justice and 26 state insurance agencies, the $15 billion deal was completed on January 23, 2020. Seven states imposed conditions on the deal with divestitures in four states. The divestitures included Centene's Illinois Medicaid and Medicare Advantage plans, WellCare's Missouri Medicaid and Medicare Advantage plans and WellCare's Nebraska Medicaid plan.

FTC and Colorado AG Impose Conditions on UnitedHealth Group and DaVita Medical Group Merger

UnitedHealth Group and DaVita Medical Group received the greenlight from the FTC and state regulators, notably with conditions imposed in Nevada and Colorado, respectively. UnitedHealth Group operates UnitedHealthcare, which is the nation’s largest health insurer, as well as Optum, its medical practice division that operates in ten states. Its integration with DaVita, a physician practice group, raises both horizontal and vertical integration concerns. In the Nevada market, the companies reached a settlement with the FTC that would require UnitedHealth Group to divest DaVita’s HealthCare Partners of Nevada. Colorado Attorney General Phil Weiser also imposed restrictions in a consent judgment.

U.S. District Court for the District of Columbia Approves CVS-Aetna Merger

In November 2018, CVS-Aetna received all regulatory approval to merge, contingent upon Aetna’s divestiture of its Medicare Part D business and other conditions imposed by individual states. However, Judge Richard Leon of the U.S. District Court for the District of Columbia halted the merger, refusing to give his rubber stamp of approval as part of the routine judicial review process. An evidentiary hearing took place in June 2019. Ultimately, the court was not persuaded by opponents to the acquisition and permitted the agreement to go through on September 4, 2019

FTC and Massachusetts AG Impose Conditions on Beth Israel and Lahey Health Merger

Massachusetts Attorney General gave her approval of the proposal to create the second-largest healthcare system in the state but imposed conditions on the mega merger. The most notable restriction, in addition to over $70 million in community investments for low-income populations, is a seven-year price cap to ensure the merged entity’s price increases remain below the state’s annual healthcare cost growth benchmark of 3.1%. This unprecedented condition most likely derived from reports by the Massachusetts Health Policy Commission (HPC), which projected a $1 billion potential cost increase from the merger. The HPC warned that the merged entity would gain greater market power and leverage in negotiating with insurers, allowing it to inflate prices. The price safeguards imposed to mitigate these effects also seemed to satisfy the FTC, which issued a statement on the same day to close its investigation of the transaction.

Justice Department Requires CVS and Aetna to Divest Aetna’s Medicare Individual Part D Prescription Drug Plan Business to Proceed With Merger

The DOJ gave its final approval to the $69 billion merger of CVS and Aetna, contingent upon Aetna’s divestiture of its Medicare Part D business. CVS’s proposed acquisition of Aetna faced strong opposition from many antitrust experts and consumer advocacy groups, and antitrust regulators agreed that the merger could cause "anticompetitive effects, including increased prices, inferior customer service, and decreased innovation,"because CVS and Aetna are major competitors in the sale of Medicare Part D prescription drug plans to individuals. To alleviate Part D consolidation concerns, Aetna reached an agreement in late September to sell its Part D business to WellCare, paving the way for the final approval of the proposed merger. Read more on The Source Blog.

DOJ approves Cigna-Express Scripts Merger without Conditions

Health insurer Cigna’s acquisition of pharmacy benefit manager (PBM) Express Scripts received approval from DOJ, following a six-month investigation by the antitrust division of the Justice Department. In reviewing the transaction, the DOJ concluded the Cigna-Express Scripts merger is unlikely to result in harm to competition or consumers because “Cigna’s PBM business nationwide is small” and “at least two other large PBM companies and several smaller PBM companies will remain in the market post-merger.” Read DOJ press release.

FTC Settles Charges Against CentraCare's Acquisition of St. Cloud Medical Group in Minnesota

The FTC approved a final order settling charges that CentraCare’s acquisition of St. Cloud Medical Group, would be anticompetitive. The consent order permitted the acquisition to proceed, but lessened its potential anticompetitive effects by requiring CentraCare to allow a number of adult primary care, pediatric, and OB/GYN physicians to leave the health system and work for other local providers or establish a new practice in the area and to provide certain financial incentives to a number of departing physicians.

Go to Top