Healthcare Providers and Insurers: DOJ Approach in Insurer Mergers and Acquisitions

Summary

This practice note explains how antitrust enforcers, primarily the Antitrust Division of the Department of Justice (DOJ), analyze health-insurer mergers. The DOJ historically has required divestitures as a condition of settling insurer mergers, but in 2016, the DOJ, joined by several states, challenged and obtained injunctions blocking two major health-insurer mergers. Most recently, in 2022, the DOJ sued to enjoin a health insurer merger, despite the parties' offer to divest certain assets and implement a firewall policy. The district court, however, rejected the DOJ's request for a permanent injunction, finding that the divestiture would preserve horizontal competition between the parties and DOJ failed to make a prima facie case regarding the transaction's vertical elements. This practice note explains the legal authorities and framework for antitrust analysis in health-insurer mergers and provides guidance about potential ways to identify and mitigate antitrust risk in these ...