By Diane Bartz
WASHINGTON A U.S. appeals court blocked health insurer Anthem Inc's bid to merge with Cigna on Friday, upholding a lower court's decision that the $54 billion deal should not be allowed because it would lead to higher prices for healthcare.The ruling will probably kill the proposed merger that was rejected by the U.S. Justice Department, 11 states and a district court judge after consumers, medical professionals and others objected to the deal. In the end, Cigna itself tried to back out.The companies still have the option of another appeal to try to save the deal.
A split decision by the U.S. Court of Appeals for the D.C. Circuit upheld the lower court ruling that Anthem failed to prove that its deal would lead to lower prices in 14 states. The appellate court also upheld a finding that the deal could hurt customers in Richmond, Virginia.
Anthem had argued that the merger would benefit "national account" customers, mainly large companies with employees in many states. The Justice Department was skeptical that any savings would be passed on to customers.Anthem's purchase of Cigna would create the largest U.S. health insurer. Rivals Aetna Inc and Humana Inc had also sought to merge but that deal collapsed this year amid opposition from the federal government and states.
Neither company immediately responded to a request for comment. The Justice Department also did not immediately respond. (Reporting by Diane Bartz; Editing by David Gregorio)
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Updated Date: Apr 28, 2017 22:00 PM