Aetna to pay $1bn to Humana as merger plan is shelved

Health insurers Aetna and Humana said that they have ended their merger agreement after a US federal court ruled against the deal, saying it would stifle competition in the Medicare Advantage programme.

“While we continue to believe that a combined company would create greater value for health care consumers through improved affordability and quality, the current environment makes it too challenging to continue pursuing the transaction,” said Aetna chairman and CEO Mark Bertolini. “We are disappointed to take this course of action after 19 months of planning, but both companies need to move forward with their respective strategies in order to continue to meet member expectations. Our mutual respect for our companies’ capabilities has grown throughout this process, and we remain committed to a shared goal of helping drive the shift to a consumer-centric health care system.”

Aetna will pay Humana $1 billion as a result of the termination of the merger agreement. Additionally, Aetna has terminated its previously announced agreement to sell certain Medicare Advantage assets to Molina Healthcare and will pay the applicable fees associated with that termination.

In 2015 Aetna unveiled plans to acquire rival health insurer Humana in a $37 billion deal.

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