Health Insurance Company Mergers Under Scrutiny
Attorney General Loretta Lynch announced recently that the government was filing suit to block both mergers, expressing concern that the consolidation would leave too much of the industry’s power in the hands of too few companies. And with that came renewed concerns that the consumer could suffer at the hands of the merged entities in the form of stifled competition leading to higher prices and lower quality of care.
The companies have strong incentives to fight the suits as both merger agreements contain breakup fees of at least $1 billion.
With the DOJ specifically commenting on their belief that these mergers can’t be solved through divestitures, it will likely come down to a court battle. Once again, stay tuned.
|Shawn Gillon, CPA
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