Beds

As of Thursday, March 17, a D.C. federal judge set a trial date for the U.S. Department of Justice’s challenge against Minnesota-based UnitedHealth Group’s merger with Change Healthcare.

Legal representation for UnitedHealth — which has key offices in Brentwood, Columbia, Kingston Springs, Lewisburg, Nashville and Smyrna — and Nashville-based Change Healthcare originally requested a June 20 start whereas the DOJ Antitrust Division requested Aug. 24. U.S. District Judge Carl J. Nichols set a trial date between the two for Aug. 1 to hear the DOJ’s complaint against the proposed, $13.8 billion merger.

“Trial will last 12 days and conclude on Tuesday, Aug. 16, 2022,” Judge Nichols said. “Plaintiffs will have seven days to present their case (including rebuttal) and defendants will have five days. The court is willing to consider various proposed divisions of the allotted time.”

The DOJ, filing suit in tandem with attorneys general of Minnesota and New York, initially contended that they would not be fully prepared until the end of August. When the companies advocated for an earlier date, they said the DOJ had already taken several months to investigate, and they argued that a swifter judgment would be in the best interest of the industry as a whole because of the cost savings that would soon avail themselves.

UnitedHealth released a statement the same day of the ruling saying, “The combination of Optum and Change Healthcare will benefit the entire health system by increasing efficiency and reducing friction, resulting in lower costs and a better experience for patients, payers and providers.”

The DOJ and attorneys general say OptumInsight’s Claims Edit System combined with Change’s industry-leading ClaimsXten would yield a market share upwards of 80 percent.

Last August, a report surfaced indicating that the U.S. Department of Justice was considering filing suit to stop UnitedHealth from acquiring Change. The transaction itself was originally announced in January 2021 with an approximate $8 billion price tag. Two months later, Justice officials requested more information about the deal, and national trade groups expressed antitrust concerns due to the proposed deal. The lawsuit seemed to confirm the Joe Biden Administration’s watchdog behavior toward competition.

The DOJ filed suit on February 24, 2022 against the planned merger between UnitedHealth Group subsidiary, Optum, and healthcare tech firm Change Healthcare, which occurred days after the companies committed to closing the transaction upon having agreed on a time by which the review has expired.

The DOJ determined the acquisition was bad for competition apropos of commercial health insurance and “for a vital technology” used by insurers to process claims and mitigate the cost of care. The suit was also conveniently timed, filed days after both companies disclosed to investors that they had informed the department about plans to close on the deal.

The DOJ classified UnitedHealth in its complaint as “a massive company that owns the largest health insurer in the United States” and would gain “access to a vast amount of its rival health insurers’ competitively sensitive information” due to the merger.

A subsequent statement released by Optum said, “Change Healthcare and Optum together can increase efficiency and reduce friction in healthcare, producing a better experience and lower costs. The department’s deeply flawed position is based on highly speculative theories that do not reflect the realities of the healthcare system.”