UnitedHealthcare said today that it has completed its acquisition of Health Net, about a week after the Connecticut Insurance Department approved the deal.
UnitedHealthcare agreed in July to pay about $510 million to buy Health Net’s northeastern licensed subsidiaries, which have 578,000 members in Connecticut, New York and New Jersey.
Under the deal, UnitedHealth agreed to purchase the rights from Health Net to assume its commercial members as they renew coverage.
UnitedHealth said it also will pay Health Net $60 million for its Medicare and Medicaid businesses.
Several physician and consumer advocacy groups had raised concerns about the deal saying that it will lead to further consolidation in the Connecticut market, creating an “anticompetitive effect.”
Those groups also raised concerns that the deal will allow UnitedHealth to “cherry pick,” Health Net customers that they offer coverage to, since they are only proposing to buy renewal rights from Health Net.
As Health Net’s commercial customers in the Northeast reach renewal dates, UnitedHealthcare said it will work to enroll them in a comparable Oxford or UnitedHealthcare plan. Until members are enrolled in a replacement plan, their current Health Net benefits remain in effect under their existing Health Net contracts.
There will be no interruption to coverage or payments during this transition period, the companies said.
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