DOJ, state attorneys general drop appeal to UnitedHealth-Change Healthcare deal ruling

After several months without any official word, the federal government and several states have called off plans to appeal a judge's ruling that allowed UnitedHealth Group to close its acquisition of Change Healthcare.

In a filing with the court Monday, attorneys representing the U.S. Department of Justice (DOJ) as well as Minnesota and New York agreed to voluntarily dismiss their challenge to the $13 billion deal. UnitedHealth won a federal district court judge's approval to close the deal in September, and the two companies formally combined the following month.

The court document does not specify why the parties chose to abandon their legal challenge to the deal. The attempt to block the merger between UnitedHealth and Change was the cornerstone of the Biden administration's antitrust agenda and coincided with a major challenge to a merger deal in the publishing industry.

Change Healthcare is now a part of UHG's Optum subsidiary. DOJ argued that the combination would make UnitedHealth Group privy to trade secrets from its insurance industry competitors that it could use to bolster its health plan arm, UnitedHealthcare.

Executives at competitors such as Aetna, Cigna and Elevance Health told the court that the deal would not stifle innovative ideas at their companies. UnitedHealth leaders, including current CEO Andrew Witty and former chief David Wichmann, testified that Optum already has access to other insurers' data and misusing that information would be hugely harmful to that business.

The district court ruled that the deal could move forward if Change sold off ClaimsXten, its claims editing business.

DOJ filed a notice about its intent to appeal in November but had not made a move since then. At the time, UnitedHealth said an appeal was "entirely without merit."