UnitedHealth Group is mounting its defense against the Justice Department's challenge to its proposed $13 billion acquisition of Change Healthcare, arguing the government's case is "flawed."
Under the proposed deal, Change Healthcare would join UnitedHealth subsidiary OptumInsight to provide software, data analytics, advisory and revenue cycle management offerings to clients.
The Justice Department filed a lawsuit challenging the acquisition Feb. 24, alleging the transaction would harm competition in commercial markets, make coverage more costly for millions of people and give UnitedHealth too much power in electronic data transactions.
UnitedHealth Group issued a public statement on the case March 17, saying the Justice Department's lawsuit is based on theories with "no basis in fact and law."
"The government's case rests entirely on speculation and theories unsupported by any past conduct, i.e., that Optum will somehow exploit Change Healthcare's products and services to secure an unfair advantage for UnitedHealthcare's health insurance business," UnitedHealth said in its statement.
"Optum's business model and financial success is dependent on providing products and services to external customers, not just UnitedHealthcare," the company added. "Put simply, any misuse of customer [competitively sensitive information] would be economic suicide for Optum because its sophisticated external customer base would simply cease using Optum's services and turn to any number of Optum competitors."
The Justice Department also argued the acquisition would give UnitedHealthcare a monopoly in claims-editing technology, but UnitedHealth said it has agreed to divest the business and plans to ink a purchase agreement in "a matter of weeks."
Read more here.