In a mutual decision, Aetna and Humana opted to end their merger agreement after Judge John Bates of the U.S. District Court ruled in favor of the Department of Justice and blocked the deal.
Here are four takeaways:
1. As per the deal's terms, Aetna will pay Humana a $1 billion break-up fee.
2. Aetna also ended its agreement to sell certain Medicare Advantage assets to Long Beach, Calif.-based Molina Healthcare. Aetna will pay the applicable fees associated with ending that portion of the deal.
3. In a 156-page opinion, Judge Bates ruled the deal would significantly reduce competition in the Medicare Advantage market in 364 complaint counties and three complaint counties in Florida.
4. In a statement, Aetna Chairman and CEO Mark T. Bertolini, said, "While we continue to believe that a combined company would create greater value for healthcare consumers through improved affordability and quality, the current environment makes it too challenging to continue pursuing the transaction. We are disappointed to take this course of action after 19 months of planning, but both companies need to move forward with their respective strategies in order to continue to meet member expectations."