- Aetna and Humana have scrapped their merger plans after the Department of Justice blocked the deal due to antitrust concerns. Aetna will pay Humana a $1 billion termination fee, included as part of the original agreement.
The DOJ lawsuit, along with increased opposition from medical and political organizations, helped to end the merger. A class-action shareholder lawsuit followed the DoJ block.
“While we continue to believe that a combined company would create greater value for health care consumers through improved affordability and quality, the current environment makes it too challenging to continue pursuing the transaction,” said Aetna Chairman and CEO Mark T. Bertolini.
“We are disappointed to take this course of action after 19 months of planning, but both companies need to move forward with their respective strategies in order to continue to meet member expectations. Our mutual respect for our companies’ capabilities has grown throughout this process, and we remain committed to a shared goal of helping drive the shift to a consumer-centric health care system.”
“On behalf of Aetna, I would like to thank everyone involved in the transaction for their commitment to improving how health care is delivered,” Bertolini concluded.
Several lawmakers, including Richard Blumenthal (D-CT), Al Franken (D-MN), Elizabeth Warren (D-MA), and Sherrod Brown (D-OH), highlighted the problems of the merger in a letter to Renata Hesse, the Principal Deputy Assistant Attorney General at the Department of Justice. In the months following the letter, other opponents spoke out against the potential impacts of the merger on consumer prices.
The DoJ continues to scrutinize planned mega-mergers between some of the nation’s largest payers. Cigna and Anthem are also facing federal opposition to their planned $48 billion merger, despite arguments that the deal could save Americans $2 billion in healthcare costs.
Healthcare mergers continue to be hotly debated, and seem to have a highly uncertain future.