Shares of healthcare companies, Aetna, Inc. (NYSE: AET) and Humana, Inc. (NYSE: HUM) fell below 2 percent after a U.S. federal judge denied the company’s merger deal, saying it violated antitrust law. U.S. District Court for the District of Columbia, Judge John Bates, said the projected deal would considerably reduce competition.
“The government identified 364 counties across 21 states where it argues that concentration in the Medicare Advantage market would rise above the presumptively unlawful level if the merger proceeds, and 17 counties across 3 states where that would be true in the public exchange markets,” said Judge John Bates in court documents.
Aetna wants to appeal the judge’s ruling, according to Reuters, saying “we’re reviewing the opinion now and giving serious consideration to an appeal after putting forward a compelling case.”
According to CNBC, antitrust regulators had been concerned about the impact that the $34 billion merger would have on the health insurance industry because they said it would reduce competition. The U.S. Justice Department filed a lawsuit in July asking the court to stop the deal, arguing it would lead to higher prices for seniors and the disabled on Medicare as well as people who use the individual insurance program created under the Affordable Care Act. The Obama administration had previously argued that the deal would create Medicare Advantage monopolies in 70 counties and increase market concentration in hundreds more across the country.