Dive Brief:
- Sen. Elizabeth Warren, D-Mass., and Rep. Pramila Jayapal, D-Wash., are asking regulators to closely scrutinize UnitedHealth’s proposed $3.3 billion acquisition of home health and hospice provider Amedisys.
- The progressive lawmakers sent a letter Tuesday to the heads of the Department of Justice and the Federal Trade Commission urging heightened attention to the transaction, which the companies first announced over the summer.
- In August, the DOJ requested more information from Amedisys regarding the transaction, subsequently pushing back the timeline of the deal.
Dive Insight:
The Biden administration has taken an increasingly aggressive stance in antitrust oversight, including in healthcare. The DOJ is currently pursuing an antitrust probe into the managed care sector, and regulators have requested additional information in a number of big-ticket deals by insurers — including UnitedHealth.
UnitedHealth’s $5.4 billion acquisition of home health group LHC and the payer’s $13 billion acquisition of data analytics firm Change Healthcare were hit with second requests, but both deals eventually went through.
UnitedHealth’s health services arm Optum announced its plans to acquire Amedisys in June, after the Louisiana-based provider reneged on an existing merger agreement with Option Care Health. UnitedHealth has been actively acquiring provider groups, especially in home and community-based care, banking that providing convenient, high-quality care at a lower cost will prove lucrative in value-based arrangements as the U.S. population ages.
“We urge DOJ and FTC to closely scrutinize UnitedHealth’s proposed acquisition of Amedisys, and oppose the growing trend of insurers buying up health care providers to reduce competition and pad their profits at the expense of their patients,” Warren and Jayapal wrote in the letter.
In urging heightened scrutiny of the deal, Warren and Jayapal pointed to UnitedHealth’s existing market power in Medicare Advantage and physician groups, and the geographic overlap between Amedisys and LHC Group.
“Optum’s proposed acquisition of Amedisys would further entrench the company’s dominance, as Amedisys and LHC Group are two of the largest home health groups in the country,” Warren and Jayapal wrote. “This deal is clearly anticompetitive as it would result in consolidation of home health and hospice services in some regions.”
Regulators have historically struggled to make a case against complex and non-traditional tie-ups, which have proliferated in healthcare as hospitals look to expand across markets and insurers purchase provider groups, among other plays.
In July, the FTC and DOJ proposed updates to merger guidelines that could give them new ammunition in targeting such deals.
