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On the heels of an agreement with the U.S. Department of Justice, UnitedHealth Group (NYSE: UNH) has closed its acquisition of the home health and hospice provider Amedisys.
Amedisys announced the news in a U.S. Securities and Exchange Commission (SEC) filing on Thursday. The UnitedHealth Group subsidiary Optum, in June 2023 inked its agreement to acquire Amedisys in an all-cash transaction of $101 per share, or about $3.3 billion.
Amedisys on Thursday also stopped trading on the Nasdaq.
”“In accordance with the terms of the Merger Agreement, at the Effective Time, [Amedisys] merged with and into the [UnitedHealth Group], with the Company surviving the Merger as a wholly-owned subsidiary of Parent.” the SEC filing indicated.
Amedisys offers home health, hospice and palliative care, among other services to more than 465,000 patients annually across 38 states and Washington D.C. On a consolidated basis, Amedisys earned $621 million in net service revenue during Q2, up from $591.2 million year over year. Its hospice segment brought in $215 million, up from $204 million in the prior year’s quarter.
The merger likely makes UnitedHealth Group the largest hospice provider in the United States. The company in 2023 also acquired the large home health and hospice provider LHC Group for $5.4 billion.
Closure of the Amedisys deal has been a long time coming. The transaction hit a number of regulatory hurdles that led to a two year delay. This culminated in a lawsuit by the DOJ to block the deal due to antitrust concerns.
The parties to the lawsuit on Aug. 7 reached a deal that would allow the transaction to go forward. It included the mandated divestiture of 164 Amedisys and UnitedHealth Group care home health and hospice locations across 19 states. The companies found buyers in The Pennant Group (Nasdaq: PNTG) and BrightSpring Health Services (Nasdaq: BTSG).
The divestiture also includes one palliative care facility. The total divestiture accounts for $528 million in revenue.
The agreement would also impose a monitor to supervise UnitedHealth’s divestiture of the assets and compliance with an associated consent decree. Amedisys would also have to pay a $1.1 million civil penalty, as well as provide antitrust compliance training to its leadership.
“In no sector of our economy is competition more important to Americans’ well-being than health care. This settlement protects quality and price competition for hundreds of thousands of vulnerable patients and wage competition for thousands of nurses,” said Assistant Attorney General Abigail Slater of the Justice Department’s Antitrust Division, in a statement. “I commend the Antitrust Division’s Staff for doggedly investigating and prosecuting this case on behalf of seniors, hospice patients, nurses, and their families.”
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