Since information surfaced Tuesday that the Justice Division had opened an antitrust investigation into UnitedHealth Group (NYSE: UNH), further questions have bubbled up.

These questions are in regards to the residence care supplier Amedisys Inc. (Nasdaq: AMED), which agreed to be acquired by Optum from UnitedHealth Group final June.

Will that deal be affected, both by being withdrawn or rejected fully?

Then, from a extra macro perspective, the payer construction comes into query. Will payers generally be much less eager on healthcare suppliers – and residential care suppliers –?

The analysis continues to be in its early phases, so there’s nonetheless a protracted technique to go. However the examine itself wasn't a lot of a shock to those that had been paying consideration.

“I believe it’s well-known and the scope and scope of it’s nicely documented [UnitedHealth Group] has been amassed over the previous a number of years,” Tyler Giesting, director of healthcare and life sciences at West Monroe, informed me on Wednesday. “After which, given the context of the overall antitrust alerts that the administration has been sending, … it's not shocking given the best way the administration has challenged quite a lot of offers in well being care and in any other case.”

Certainly, the Biden administration has taken a tricky stance towards anticompetitive healthcare offers, in addition to sure PE-driven offers.

And right here you may have UnitedHealth Group, by some statistics the most important well being care firm within the nation. Furthermore, it’s the most prolific purchaser.

The analysis might result in many modifications in healthcare, residence care and in any other case.

Sorting via that potential change is the objective of this week's unique, members-only HHCN+ Replace.

What comes subsequent

As one of many largest residence care and hospice suppliers within the nation, Amedisys' touchdown spot is of nice significance to the remainder of the trade.

It's been greater than eight months since UnitedHealth Group lured the corporate away from Choice Care Well being (NASDAQ: OPCH), leading to a $106 million termination price. But it surely's value holding in thoughts that UnitedHealth Group's first residence care settlement – ​​for an additional of the most important residence care suppliers, LHC Group – was not finalized till eleven months after the acquisition value was agreed.

Amedisys will attain that objective by the top of Might, so there's no cause to boost alarm bells on that entrance but.

On the one hand, Amedisys and LHC Group collectively would outcome within the largest residence well being care entity within the US. Alternatively, because of the nature of the house care trade, Optum would nonetheless solely personal about 10% of the house care market – not an enormous quantity.

For context, UnitedHealth Group already owns about 30% of the Medicare Benefit (MA) market.

However the investigation will undoubtedly complicate issues for Amedisys, particularly after an earlier DOJ investigation into the deal. Sen. Elizabeth Warren (D-Mass.) and U.S. Rep. Pramila Jayapal (D-Wash.) additionally requested antitrust regulators in October to take a better have a look at the deal.

My wager is that the Amedisys deal nonetheless goes via, however it might take longer than LHC Group's timeline of 11 months. There might also be some caveats, corresponding to the truth that Amedisys must divest sure belongings.

“I don't assume you’ll be able to say that this received't impact the deal,” Giesting stated. “As a result of, based mostly on the knowledge publicly reported, Amedisys could possibly be extremely interpreted as concerned in some features of this investigation. And the DOJ was already concerned within the Amedisys evaluation. …It's fully potential that this investigation can have penalties in a roundabout way, whether or not it's a delay or one thing else. However I don't assume will probably be checked out in a vacuum.”

Giesting didn’t wish to gamble on whether or not or not the deal can be accomplished.

He did say that if it's achieved, he nonetheless expects it to be achieved by the top of 2024.

Different components to contemplate

Theoretically, authorities businesses are anticipated to stick to comparatively constant guiding ideas no matter who’s president.

However let's name every thing by title and understand that it often doesn't work that method. And in lower than a 12 months, there could possibly be a completely new administration in Washington DC

That's one factor to contemplate.

However for now, one other factor to contemplate is how it will affect the remainder of the house care trade. If the cope with Amedisys doesn’t shut, that might in fact be large information.

But it surely might additionally affect different residence care offers, particularly on a bigger scale. I wrote earlier this month that I believed UnitedHealth Group would have been completely happy to make a proposal for Enhabit Inc. (NYSE: EHAB) if it weren't for all of the antitrust noise (and this was earlier than the investigation began).

The rise of cost suppliers has led to extra potential touchdown spots for bigger residence care suppliers.

Humana Inc. (NYSE: HUM), for instance, already has CenterWell Dwelling Well being, however it want to broaden its footprint in residence well being. It's in all probability holding an in depth eye on the Optum-Amedisys saga.

All of this might imply that payers are taking a break from their aggressive payvider technique.

Or not, as Giesting believes.

“I wouldn't count on some other payers [to change course]” he stated. “I believe you'll proceed to see payers trying to broaden as Medicare Benefit continues to develop, regardless of the speed headwinds. And likewise broaden in a method that helps management prices and take care of a few of their sicker , coordinate higher-end members and sufferers inside that vertical community.”

And whereas the investigation is in some methods an enormous deal, Giesting isn't so positive it's sufficient to drive UnitedHealth Group to vary course on its M&A thesis — no less than not but.

“I don't assume it will have a big affect on their enterprise growth strategy and technique within the brief time period,” he stated. “I believe that might be just a little untimely.”