And another thing

This morning, the federal judge who heard the Aetna-Humana merger case, John Bates, issued a 160 page opinion blocking the merger based on federal antitrust law.  Aetna and Humana are major players in the Medicare Advantage program.  Aetna and Humana argued that Medicare is a unified market. The judge disagreed finding that traditional Medicare and Medicare Advantage markets are separate markets for antitrust law purposes. That appears to be the linchpin in the decision. 

Here’s a Reuter’s article on the court decision. 

“We’re reviewing the opinion now and giving serious consideration to an appeal after putting forward a compelling case,” Aetna spokesman T.J. Crawford said. Humana did not respond to a request for comment.  Humana stands to receive a $1 billion breakup fee from Aetna should the deal be abandoned.
Jeffrey Jacobovitz, a litigator at law firm Arnall Golden Gregory LLP, said that appeals at the D.C. Circuit succeed about one-third of the time and can take a year to resolve. He added that it would be difficult, though not impossible, for Aetna to wait for Trump’s new antitrust enforcers to be named and then strike a settlement to save the merger, perhaps by offering to divest more assets.

Aetna and Humana also sponsor FEHB plans.  As noted yesterday,  Judge Amy Berman Jackson’s decision in the Anthem – Cigna merger case is expected this week.

Govexec.com provided details on the President’s executive order issued today that imposes a temporary hiring freeze on federal agencies.  “The memorandum gives the directors of the Office of Management and Budget (Trump’s pick, Rep. Mick Mulvaney, R-S.C., will face confirmation hearings Tuesday) and the Office of Personnel Management (Trump has yet to name an OPM leader) 90 days to come with a “long-term plan to reduce the size of the federal government through attrition.” Once that plan is implemented, the hiring freeze will expire.”

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