Published: Wed, February 15, 2017
Economy | By Melissa Porter

Cigna Sues Anthem For $15 Billion

The companies have been quarreling for months, including during a federal trial over whether their proposed $48 billion merger violated USA antitrust law.

Aetna and Humana announced the deal in July 2015, just a few weeks before Anthem Inc and Cigna Corp said they would also combine.

"U.S. District Judge John Bates found that to be the case, writing in his decision that, "the merger of Aetna and Humana would be likely to substantially lessen competition in markets for individual Medicare Advantage plans and health insurance sold on the public exchanges" in 364 counties". After the court ruling, both companies weighed the deal and chose to abandoned the merger. Hartford, Connecticut-based Aetna said it made a decision to quit the exchanges in 2017 purely for financial reasons, but Bates did not buy that argument.

The health insurance companies came to a mutual agreement to terminate the merger, according to a statement from Aetna Chairman and CEO Mark T. Bertolini.

This August 2011 photo shows the entrance to the Humana building, in Louisville, Ky.

Last week, Humana released an earnings report that revealed little about whether the company aims to fight on in court to merge with health insurer Aetna or walk away.

Attorneys for Aetna and Humana argued the tie-up would bring about efficiencies that would result in lower premiums and that a deal with Molina Healthcare would divest Aetna of customers where the merger might threaten competition.

But don't point the finger at us for this, the statement implies: It was Anthem that was in charge of the "full responsibility to lead the federal and state regulatory approval process, as well as the litigation strategy", so you can feel free to blame Anthem. The Justice Department challenged both deals-Aetna's attempt to buy Humana, and a planned merger between Cigna and Anthem-on the grounds that they violated antitrust law.

But, Anthem is pushing forward with an appeal, on the basis that 99 per cent of the votes cast by both shareholders of the companies approved of the merger. This stumped presiding Federal District Judge Amy Berman Jackson.

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