Judge denies DOJ’s move to block $13B UnitedHealth, Change deal

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A federal judge dismissed the Justice Department’s attempt to block UnitedHealth Group’s $13 billion purchase of Change Healthcare, handing the healthcare giant a win on Monday as its reach continues to expand.

Judge Carl Nichols’ decision follows an August court hearing in which the DOJ argued that UnitedHealth for Change’s offering would put competitors at a disadvantage and result in higher costs, lower quality, and less innovative commercial health insurance for Americans.

Nichols’ Monday statement was sealed because it “could contain competitively sensitive information,” meaning his explanation behind the decision to allow the deal is closed to the public.

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“We are pleased with the decision and look forward to working with Change Healthcare as soon as possible so we can continue our work together to make the healthcare system work better for everyone,” UnitedHealth said in a statement provided to Healthcare Dive became.

It’s unclear if the DOJ will appeal.

“We respectfully disagree with the court’s decision and are closely reviewing the opinion to assess next steps,” Assistant Attorney General Jonathan Kanter said in a statement.

UnitedHealth’s reach touches almost every corner of the healthcare sector. The company operates one of the nation’s largest health insurance companies and last year issued more than 1 billion prescriptions through its pharmacy benefits manager. It also owns medical groups and surgery centers.

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UnitedHealth announced last year that it had signed a deal to buy Change Healthcare, which would provide an important opportunity to leverage insights from billions of health claims, the two said.

Healthcare providers use Change’s technology to submit claims to health insurers, who also use the technology to assess and process those claims.

The DOJ argued that UnitedHealth had access to technology that its competitors rely on to compete with United, according to the complaint filed in federal court in February.

“Change’s technologies save United’s competitors tens of billions of dollars each year and reduce healthcare costs for American families,” the complaint reads.

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With Change, regulators argued that UnitedHealth would have access to vast amounts of competitive data about its competitors.

To address some of the antitrust concerns, UnitedHealth announced it would sell Change’s claims payment and processing business to private equity firm TPG Capital.

Nichols, an appointee for President Donald Trump, directed UnitedHealth to divest ClaimsXten to TPG Capital as proposed.

Concerned about the pace of consolidation, President Joe Biden vowed to crack down on mergers in the healthcare sector and last year issued an executive order for regulators to “overhaul and overhaul” merger guidelines.

Change Healthcare shares were up Tuesday morning after the news.

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