Wall Street Journal, February 9, 2017
Brent Kendall and Anna Wilde Mathews

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WASHINGTON--A federal judge, in a Wednesday evening decision, blocked health insurer Anthem Inc. from acquiring rival Cigna Corp., the second court ruling in recent weeks to deal a decisive rebuke to efforts to reshape the industry through megamergers.

The decision, by U.S. District Judge Amy Berman Jackson, said the proposed $48 billion deal violated federal antitrust law because it would create an unacceptable reduction in the number of companies able to serve large multistate employers that insure their workers.

"The evidence has also shown that the merger is likely to result in higher prices, and that it will have other anticompetitive effects: it will eliminate the two firms' vigorous competition against each other for national accounts, reduce the number of national carriers available to respond to solicitations in the future, and diminish the prospects for innovation in the market," Judge Jackson wrote.

The ruling echoed a decision last month by a different judge who blocked Aetna Inc.'s plans to take over Humana Inc. Though the two proposed insurer combinations were different in many ways, the message from the courts was similar: Judges found that merging top industry rivals threatened to harm consumers on price and service, with the benefits of those deals failing to outweigh the threats. [...]

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