The Hartford (CT) Courant (12/7, Sturdevant) reports UnitedHealthcare's bid to "acquire the membership renewal rights of Health Net customers in Connecticut was approved Friday by Insurance Commissioner Thomas Sullivan. The transaction shifts the number of major healthcare providers from six to five in Connecticut." As covered in previous briefings, several physician organizations "opposed the merger," alleging that the cost of "treatment would increase as insurance providers decrease." But Sullivan pointed out that a "year ago, Health Net announced it was initiating a strategic review of its Northeast business options, including leaving the state. If Health Net did not partner with another company," its policyholders would have been "left to secure replacement coverage on their own without the benefit of UnitedHealthcare's" coverage commitment. Sullivan added that the Department will "continue its strong regulatory oversight over Health Net during the transition."

        The Hartford (CT) Business Journal (12/7, Bordonaro) notes that UnitedHealth "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." Following Sullivan's decision, UnitedHealth issued a press statement saying "it will 'work to ensure a smooth transition process for members" and healthcare providers. However, Connecticut State Medical Society President Kathleen LaVorgna "said in a statement today that her organization doesn't 'see any inherent benefit for patients in this acquisition.'" She said the medical society "might appeal the decision in state court."

        According to the Danbury (CT) News Times (12/7, Varnon), the Insurance Department "will require the companies to file regular updates for the next two years. Health Net is to maintain accounts with its employees through 2010 under the terms of the acquisition, which will close later in 2010."

        Connecticut AG to probe acquisition for antitrust violations. The Hartford Business Journal (12/7, Bordonaro) reports, "State Attorney General Richard Blumenthal said today he is investigating" the UnitedHealth acquisition "on antitrust grounds. Blumenthal said his office is gathering information about the deal and has asked for a meeting with representatives of both companies."

        Dow Jones Newswire (12/7, Bray, subscription required) quotes from a press statement in which Blumenthal said his office will look into whether the acquisition will have "anticompetitive consequences for Connecticut consumers in violation of state antitrust law. One of our concerns is whether the merger will cause excessive concentration in some segments of the health insurance market and thereby unlawfully restrain competition."

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