Justice Department sues UnitedHealth over nearly $8 billion deal

Federal regulators are suing to block UnitedHealth Group’s purchase of technology company Change Healthcare, a deal announced more than a year ago.

The US Department of Justice said on Thursday the proposed deal would harm competition and give UnitedHealth Group – which runs the nation’s largest insurer – access to sensitive information about competitors’ claims.

“If the largest U.S. health insurer is allowed to acquire a major competitor for critical healthcare claims technologies, it will undermine competition for health insurance and stifle innovation in employer health insurance markets. “U.S. Attorney General Merrick Garland said in a statement.

Justice Department officials said in the statement that the deal would give UnitedHealth control of a “critical data highway through which approximately half of all Americans’ health insurance claims travel each year.”

A UnitedHealth spokesperson said Thursday that the Justice Department’s “deeply flawed position is based on highly speculative theories that do not reflect the realities of the health care system. We will vigorously defend our case.

UnitedHealth said in January 2021 that it would spend nearly $8 billion in cash to add the company and build its ability to provide data analytics and revenue cycle management assistance, among other offerings.

The deal is worth about $13 billion including debt, and the companies initially expected it to close in the second half of 2021.

In addition to running a health insurer, UnitedHealth also operates a growing Optum business that provides care, manages pharmaceutical claims, and offers technology services and support.

The Justice Department was joined by the attorneys general of Minnesota and New York to file the lawsuit.

Shares of UnitedHealth fell more than 1%, or nearly $8, to $451.63 in midday trading, while broader indexes also fell.


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