The merger between two major health insurance providers, Anthem and Cigna, has been blocked by a federal judge last Wednesday. Anthem plans to appeal the decision.
Anthem's attempt to acquire Cigna and become the largest health insurer in the United States has been prevented, reports Fox59. This decision came from District Court Judge Amy Berman Jackson.
The order read that the merger would have resulted in unfair prices as well as anti-competitive behavior. Jackson also stated that Cigna has been seeking to reduce costs by increasing health and that its approach has so far been successful.
Anthem, on the other hand, has used an approach that incorporated cost savings incentives with quality. Anthem has stated that it intends to appeal to the decision, wrote Fox59.
The deal was first made public two years ago in 2015. In July 2016, the Court of Justice filed a lawsuit against it claiming antitrust violations.
The Department of Justice stated that decision is a victory for the consumers in the country. The merger would have had negative effects on competition, increased health insurance premium as well as caused a decline in the innovation that is aimed towards decreasing healthcare costs.
According to the New York Times as reported by Jobs & Hire, Obama's administration saw a rise in mergers in 2015, followed by a decline in 2016 due to the efforts it took to limit it. However, Trump's present seat in office may turn it around.
So far two mergers gave been blocked namely Aetna and Humana as well as Cigna and Anthem. The former deal was at $37 million while the latter was valued at $54 billion, reports Fox59.
The news site also wrote that stocks for Cigna dropped slightly following the decision. On the other hand, Anthem's was flat.
For more news and updates, follow Jobs & Hire.
© 2017 Jobs & Hire All rights reserved. Do not reproduce without permission.
