UnitedHealth Group (NYSE:UNH) and Amedisys (NASDAQ:AMED) have postponed the deadline for their $3.3 billion merger while addressing antitrust investigation from the U.S. Department of Justice (DOJ). This extension follows the DOJ and many states filing a lawsuit to prevent the merger, contending that it will diminish competition in the home health care industry.
The transaction, which will integrate Amedisys into UnitedHealth's Optum division, was originally scheduled to conclude by the end of 2024. According to a regulatory filing, both corporations have extended the deadline to December 31, 2025. This action grants extra time for legal processes to progress and for possible conversations with the DOJ to reach a resolution that may address regulatory issues.
The prolongation was disclosed in filings with the U.S. Securities and Exchange Commission (SEC), wherein both UnitedHealth and Amedisys indicated that they relinquished their rights to cancel the merger agreement due to the inability to finalize the deal by the first date.
The DOJ's lawsuit focuses on concerns that the merger of UnitedHealth's current home health services, via its acquisition of LHC Group, with Amedisys would establish a market leader, potentially resulting in increased service costs and diminished choices for patients and healthcare professionals. UnitedHealth has refuted these allegations, contending that the combination will promote competition, foster innovation, and enhance patient care.
This development reflects a trend of heightened regulatory scrutiny on healthcare mergers, especially those involving substantial corporations such as UnitedHealth. The resolution of this case may establish precedents for the examination of analogous mergers in the future, particularly in industries vital to public health, such as home health care.
Both firms are dedicated to the merger, with UnitedHealth asserting that the integration with Amedisys would foster innovation and enhance access to quality treatment. Simultaneously, they are preparing to legally defend their position, possibly through divestitures or alternative structural remedies, to mitigate the DOJ's competition apprehensions.
The ongoing legal dispute will be closely monitored by the healthcare sector and investors as the high-stakes merger faces regulatory examination.