Humana will divest Medicare Advantage plans in five states in order to acquire Arcadian Management Services, the insurer said.
The Justice Department announced a civil lawsuit to stop the acquisition, but said the deal could proceed if Humana agreed to a settlement to divest health plans in counties and parishes of Arizona, Arkansas, Louisiana, Oklahoma and Texas. The U.S. District Court in Washington, D.C., must approve the settlement.
The acquisition, as announced in October, “would have eliminated Medicare Advantage competition between Humana and Arcadian” the Justice Department said in a news release.
The Justice Department said it would require health plan divestitures in 51 counties or parishes with a combined 71,000 Medicare Advantage enrollees, including 45 counties or parishes where Humana would control from 40% to the entire Medicare Advantage market following the acquisition without divesting assets as proposed.
“Pursuant to a consent agreement reached with the Department of Justice, Humana—after completing the acquisition of Arcadian Management Services, Inc.—will divest health plan business representing approximately 13,000 Medicare Advantage members in five states by the end of 2012,” according to a statement from Humana.
The deal would increase Humana’s Medicare Advantage enrollees by 50,000 members, the insurer said.
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