Aetna has announced it will refile its pre-merger notifications with the U.S. Department of Justice and U.S. Federal Trade Commission regarding its acquisition of Humana. This will give the DOJ and FTC an additional 30 days to review the proposed merger and determine whether it passes regulatory muster. Aetna made this information public via an Aug. 17 filing with the Securities and Exchange Commission.
Aetna announced its intent to acquire Humana in July.
According to Aetna, it filed this extension “as part of its continuing cooperation with the U.S. Dept. of Justice and in order to provide the DOJ with additional time for review.” Aetna added it specifically will refile its pre-merger notifications with the DOJ and the FTC under the Hart-Scott-Rodino Antitrust Improvements Act, in connection with its proposed acquisition of Humana.
The HSR Act establishes waiting periods before certain acquisitions may be completed and authorizes enforcement agencies to extend those periods until the companies provide additional information about the proposed transactions. The goal is for the DOJ and FTC to ensure these deals won’t violate U.S. antitrust laws.
The notification was to be re-filed either on or before Aug. 19, initiating a new waiting period under the HSR Act that expires 30 days later, unless it’s extended again to get more information or terminated earlier.
Aetna reported it still expects its acquisition of Humana to close in the second half of 2016.
Health industry experts say they expect the DOJ to heavily scrutinize the Humana/Aetna deal and the other recently announced mega-deal between Anthem and Cigna, because if they both went through it would fundamentally change the nature of the domestic health care industry.
“I think we’re going to see a great deal of comment from the health care community about these mergers and the DOJ will likely give those concerns serious consideration,” said Jim Smith, senior vice president at health care consulting company The Camden Group, in Rochester, N.Y., quoted by Health Leaders Media.
On Aug. 5, the American Hospital Association wrote a letter to the DOJ expressing its deep concerns that the Humana/Aetna and Cigna/Anthem deals will profoundly, and negatively, impact consumers. While the AHA’s letter mostly addressed Cigna and Anthem, it said it will also write a second letter outlining its concerns about Humana and Aetna in the near future.
“Because the size and scope of these proposed acquisitions is so enormous and their potential anticompetitive impact on access, affordability and innovation is so profound, we will address them in separate letters,” the AHA wrote. “We believe the announced deals cited above have that potential and, therefore, merit the closest scrutiny to determine whether remedies, such as divestitures, have any chance of ameliorating the enduring damage they could do as a result of the loss of such significant competition.”