At least one of the health insurance industry's mega mergers is off for good. Aetna and Humana said Tuesday they will not appeal the judge's ruling in the recently decided anti-trust case, which denied their $34 billion tie-up. Hartford-based Aetna will now pay Humana a $1 billion break-up fee.
Judge John Bates ruled last month in federal court in Washington D.C., that the merger would threaten competition in the Medicare Advantage market, in which both companies are major players. His ruling was followed just weeks later by another judge's denial of the deal between Anthem and Cigna.
In a statement issued Tuesday, Aetna CEO Mark Bertolini said, "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.”
"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," the statement went on.
Humana is expected to speak with analysts later today to issue financial guidance for 2017.
Speculation over the future of Aetna's Connecticut headquarters is bound to continue. The company had done nothing to quell rumors that it had plans to move its headquarters to Humana's Kentucky base, had the deal gone through. It's also recently been revealed to be shopping for real estate in Boston.
Anthem, meanwhile has filed an appeal of the ruling in its merger with Bloomfield-based Cigna. That merger was denied largely on the grounds that it would threaten competition over large employer-based plans.