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23 August 2019Big PharmaSaman Javed

FTC approves UnitedHealth’s $4.3bn acquisition of DaVita Medical

The US Federal Trade Commission ( FTC) has approved a final order settling charges that healthcare company  UnitedHealth’s $4.3 billion acquisition of  DaVita Medical would harm competition.

In an announcement yesterday, August 22, the FTC approved the order following a public comment period.

Under the terms of the order, issued on August 12, United is required to divest DaVita Medical to Intermountain Healthcare, a Utah-based healthcare provider and insurer.

According to the original complaint, the proposed acquisition would have reduced competition by 80% in the markets for managed care provider organisation services sold to Medicare Advantage insurers, and Medicare Advantage plans sold to individual Medicare Advantage members.

"The complaint alleges that elimination of this competition would increase healthcare costs and decrease competition on quality, services and other amenities in the affected area," the FTC wrote.

The proposed acquisition also would have positioned UnitedHealth to raise the costs of its managed care provider organisation services to rival Medicare Advantage insurers, according to the complaint.

UnitedHealth first announced the proposed acquisition in 2017, and the transaction was expected to close in 2018.

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