UnitedHealth says DOJ resting on 'speculative theories' to challenge Change Healthcare acquisition

UnitedHealth Group is firing back at the Department of Justice (DOJ), arguing in a court filing that its case rests on "speculative theories" for how the healthcare giant could behave once it completes its acquisition of Change Healthcare.

UHG announced in January 2021 that it would purchase Change in a deal worth nearly $8 billion in cash and $5 billion in debt. The two companies expected the deal to close in the latter half of 2021 but postponed consummating the merger until February to allow DOJ to conduct its investigation.

The Justice Department sued to block the deal Feb. 24, just a few days shy of the companies' planned closure date.

In the suit, for example, the feds argue that the acquisition would establish a monopoly in first-pass claims editing tools, which are offered by both Change and UnitedHealth's OptumInsight. However, UnitedHealth countered that it had agreed to divest Change's claims editing business several months ago and is currently gathering bids with the expectation that the divestiture will close in the next few weeks.

"None of the actual antitrust theories the Government asserts to challenge the transaction can be squared with the facts on the ground," UnitedHealth said in the filing.

The major contention from the DOJ as well as critics of the merger was that allowing Optum to absorb Change Healthcare would give UnitedHealth access to information on its competitors that it could use to get a leg up.

The healthcare giant says misusing data provided to OptumInsight to help UnitedHealthcare get ahead would amount to "economic suicide" for that business. While OptumInsight does service UHC, it relies significantly on relationships with other payers and providers—misusing their data would cost the business the bulk of its clientele.

OptumInsight operates "at arm's length" from UnitedHealthcare, UHG said.

In addition, UnitedHealth says in the filing that OptumInsight already has access to such data through its existing payer relationships, and no insurer would partner with them if they did not have protections in place already to secure the data as well as to prevent their misuse internally.

"Breaching that trust would harm the value of the newly combined business by orders of magnitude greater than any conceivable gain," UnitedHealth said.

The courts Thursday also set the trial date for the case, Aug. 1. The trial is set to last 12 days, according to the court filing, and U.S. District Judge Carl J. Nichols will preside.