UnitedHealth Group’s (NYSE:UNH) planned acquisition of Amedisys Inc. (Nasdaq:AMED) is catching further scrutiny.
Late Wednesday, a report suggesting that the Department of Justice is considering a lawsuit to block Optum’s takeover of Amedisys surfaced. The deal was first agreed to in June of last year.
The news comes just a few weeks after the DOJ opened up an antitrust investigation into UnitedHealth Group. This is the first time that the Amedisys deal, specifically, has been mentioned as a potential target of the DOJ’s efforts, however.
Previously, in August of 2023, the DOJ made an inquiry for additional information regarding the Optum-Amedisys deal. In October of 2023, Sen. Elizabeth Warren (D-Mass.) and U.S. Rep. Pramila Jayapal (D-Wash.) urged the DOJ to take a closer look at the deal.
Based in Baton Rouge, Louisiana, Amedisys is one of the largest home health and hospice companies in the country. It has 521 care centers and about 19,000 employees across 37 states and the District of Columbia.
UnitedHealth Group’s Optum already acquired another one of the largest home health companies in the country – LHC Group – for $5.4 billion in February of last year. The Amedisys deal would be worth about $3.3 billion.
With LHC Group and Amedisys under the same roof, Optum would own about 10% of the home health market. That would make it the largest home health entity in the country – by far.
“I don’t think you can say that this will have no effect on the deal,” Tyler Giesting, a director of health care and life sciences at West Monroe, told Home Health Care News after the DOJ’s UnitedHealth Group probe first surfaced. “Because, based on the information that is being publicly reported, Amedisys could be very much interpreted as being involved in some aspects of this probe. And the DOJ was already involved in the Amedisys review. … It’s very possible that it will be impacted by this probe in some way, whether it’s a delay or otherwise. But I don’t think it is going to be viewed in a vacuum.”
Amedisys reported 2023 earnings at the end of February, without an accompanying earnings call. Overall, the company brought in about $2.24 billion in net service revenue in 2023, a less than 1% increase year over year. Fourth-quarter revenues checked in at about $571 million, which also represented just a slight increase.
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