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In Troubled Anthem-Cigna Merger, Time Is Of The Essence

Matthew Hurst

Indianapolis-based Anthem is hoping for a quick resolution to a lawsuit challenging its $54 million merger with fellow health insurer Cigna. Court documents indicate if the suit doesn’t move quickly, the entire deal could fall apart.

If completed, the Anthem-Cigna merger could be among the largest in history. But before the takeover happens, the companies need to prove the deal won’t violate federal anti-trust laws.

The Department of Justice has sued to block the merger, which Anthem said must happen by April 30th of next year. Beyond that date, according to Anthem, Cigna is “no longer interested in being pursued.”

The insurer contends it needs a trial by the end of the year in order to reach the April deadline. DOJ lawyers, though, said the case is too complex and far-reaching to speed up the process and shot down Anthem’s request to expedite proceedings.

The same judge was originally assigned to the Anthem-Cigna case as well as a similar one involving Aetna and Humana. Health insurance attorney and IU professor Syd Arak said the process could be sped up now that a new, separate judge has been assigned to Anthem-Cigna -- but the first decision could affect the second.

If only one merger goes through,” he said, “there’s potentially less effect on competition.”

Even if the case is sped up, Arak said, there’s no knowing what will happen. He said health insurance, unlike other businesses, takes place everywhere, so where a market begins and ends is more difficult to ascertain.

There have been a lot of Supreme Court cases that have looked at what is an unreasonable restraint on competition,” he said, “but there are none that have looked at that question when it involves health insurance mergers.”

A scheduling conference is set for Friday to hammer out court dates.