The U.S. Justice Department on Thursday (Feb. 24) filed a lawsuit in U.S. District Court for the District of Columbia to block UnitedHealth Group subsidiary Optum’s proposed $13 billion acquisition of health technology platform Change Healthcare, according to a report in The New York Times.
The lawsuit says the deal would give UnitedHealth access to a health technology company via a subsidiary of UnitedHealth Group, in the latest move by the Biden administration to clamp down on corporate consolidation of “sensitive data that it could wield against its competitors in the insurance business,” the report said.
An Optum spokeswoman said in a statement that the lawsuit is rooted in a “deeply flawed position” by the Justice Department that’s “based on highly speculative theories that do not reflect the realities of the health care system,” adding that the company would “defend our case vigorously.”
The Biden administration has tried to limit high-profile corporate consolidation, with President Joe Biden signing an executive order last year that was intended to trigger competition in several industries and appointing Big Tech critic Lina Khan to lead the Federal Trade Commission.
UnitedHealth had $287.6 billion in revenue in 2021, the report said. Its Optum division owns physician practices, surgery centers and a pharmacy benefit management company.
The Justice Department argued that the deal would enable UnitedHealth to see the rules that its competitors use to process claims and undercut them, gaining a competitive advantage with access to data about patients at other insurers. The companies said the deal would help with industry efficiency.
Related: DOJ Extends Antitrust Review Of Planned UnitedHealth, Change Acquisition
Federal scrutiny of the deal dates back to early last year, when U.S. antitrust regulators looked into proposal shortly after UnitedHealth announced it had an agreement.
UnitedHealth would fold Change Healthcare into its OptumInsight business, which boasts similar services. The American Hospital Association said in a letter that the merger could reduce competition and end up resulting in patients having to pay more, along with lower quality clinical outcomes.
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