DOJ Files Suit Against UnitedHealth Group in Bid to Stop $13 Billion Acquisition

Officials say the proposed move would harm competition in multiple markets.

A newly filed federal lawsuit seeks to stop the owner of the nation’s largest health insurance company from acquiring a key healthcare software and services firm, with officials saying the move would harm competition in both of their respective markets. 

The U.S. Department of Justice (DOJ) announced in a press release that it had filed its complaint in the U.S. District Court for the District of Columbia to prevent UnitedHealth Group Inc. from acquiring Change Healthcare Inc., a proposed $13 billion transaction. The suit is being joined by the Attorney Generals of New York and Minnesota; the latter state is where UnitedHealth Group is headquartered. 

“Quality health insurance should be accessible to all Americans,” U.S. Attorney General Merrick B. Garland said in a statement. “If America’s largest health insurer is permitted to acquire a major rival for critical healthcare claims technologies, it will undermine competition for health insurance and stifle innovation in the employer health insurance markets. The Justice Department is committed to challenging anticompetitive mergers, particularly those at the intersection of healthcare and data.”

“The proposed transaction threatens an inflection point in the healthcare industry by giving United control of a critical data highway, through which about half of all Americans’ health insurance claims pass each year,” added Principal Deputy Assistant Attorney General Doha Mekki, of the DOJ’s Antitrust Division. “Unless the deal is blocked, United stands to see and potentially use its health insurance rivals’ competitively sensitive information for its own business purposes and control these competitors’ access to innovations in vital healthcare technology. The Department’s lawsuit makes clear that we will not hesitate to challenge transactions that harm competition by placing so much control of data and innovation in the hands of a single firm.”

The DOJ asserted that the proposed transaction would effectively eliminate United’s only major rival for first-pass claims editing technology, which officials labeled “a critical product used to efficiently process health insurance claims and save health insurers billions of dollars each year.” 

The DOJ noted that Change currently also offers electronic data interchange (EDI) clearinghouse services, which transmit claims and payment information between insurers and providers.

“Indeed, Change markets itself as a valuable partner for insurers, working closely with them to innovate and problem-solve,” the DOJ’s press release read. “United’s acquisition of this neutral player would allow United to tilt the playing field in its favor, harming current competition and allowing United to control and distort the course of innovation in this industry for the foreseeable future.”

UnitedHealth Group, which is expected to surpass $300 billion in revenue for the 2022 calendar year, counts among other subsidiaries UnitedHealthcare, the largest health insurer in the United States; Optum Health, a massive network of providers scattered across the country; OptumRx, a pharmacy benefit manager; and OptumInsight, a healthcare technology business. 

Change’s revenues were $3.4 billion in 2021, the DOJ noted. 

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Mark Spivey

Mark Spivey is a national correspondent for RACmonitor.com, ICD10monitor.com, and Auditor Monitor who has been writing and editing material about the federal oversight of American healthcare for more than a decade.

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