Health insurer Aetna Inc (AET.N), which is seeking to save its merger with rival Humana (HUM.N), urged a judge to hear its case in the fall and before hearing a second merger of two other insurance companies that antitrust enforcers are trying to stop.
In court filings late Tuesday, the Justice Department, Aetna and Anthem Inc (ANTM.N) – which is looking to merge with Cigna Corp (CI.N) – all said that the cases should be heard separately rather than jointly. Aetna and Anthem asked for hearings to be held in the fall while the government has asked for next year.
The Justice Department filed lawsuits on July 21 asking a federal court to stop Anthem’s planned $45 billion purchase of Cigna as well as Aetna Inc’s $33 billion planned acquisition of Humana.
Judge John Bates of the U.S. District Court for the District of Columbia will be deciding if the deals can go forward.
The Justice Department argues the deals would reduce competition, raise prices for consumers and stifle innovation if the number of large, national insurers fell from five to three.
The department believes that there is no settlement possible in either case, according to a source familiar with the agency’s thinking.
In its filing with Humana, Aetna urged the judge hearing the case to hold a trial in the mid-fall in hopes of getting a decision before Dec. 31, a deadline for the deal’s completion. They asked for a two-week trial.
Aetna argued that a single question will dominate the trial: Does Medicare Advantage, which is managed by insurance companies, compete with Medicare, which is managed by the government? The government says that the two products do not compete while insurers argue that they do.
The government, for its part, said that they could be ready for trial by Feb. 17. “Defendants’ proposals are impractical,” it said in a filing late Tuesday.
Anthem expressed concerns that Cigna would bolt if there was no decision by April 30, 2017, pointing in its court filing to reports detailing the companies’ contentious relationship. The government brushed this aside, saying: “Whether defendants are getting along (or not) should not cause the court to rush its schedule or deprive plaintiffs of an adequate opportunity to prepare for trial.”
(Reporting by Diane Bartz; Editing by Bernard Orr)
