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US readies suits to block large health mergers: source
[NEW YORK] The Justice Department is preparing antitrust lawsuits to block two major health industry mergers, Anthem's acquisition of Cigna and Aetna's purchase of Humana, a person familiar with the matter said on Tuesday.
US justice officials fear the implications for consumers of consolidation that would shrink the number of major health insurers from five to three. The department could file the lawsuits to block the deals later this week or next week, the person said.
One year ago, Aetna announced plans to buy Humana for about US$37 billion to link two companies with about 33 million customers.
That was followed three weeks later by Anthem's bid to buy Cigna for US$54.2 billion.
That would leave both of the combined companies closer to UnitedHealth Group, the dominant power in the industry.
A wave of mergers among insurers, drugmakers, and hospital operators has swept the health industry prompted by President Barack Obama's health care law.
US media have reported that the Justice Department's concerns about the Anthem deal have centered on the impact on the national employer market, while worries about Aetna have focused on the impact on private health care plans.
Shares of all four companies tumbled on news of the expected US opposition, with Aetna falling 2.7 per cent, Humana 3.9 per cent, Anthem 2.2 per cent and Cigna 2.1 per cent.