Introduction

On August 7, 2025, the U.S. Department of Justice (DOJ) Antitrust Division, along with state co-plaintiffs from Maryland, Illinois, New Jersey, and New York, announced a proposed settlement to resolve their challenge to UnitedHealth Group Incorporated’s $3.3 billion acquisition of Amedisys Inc. This settlement, which requires the divestiture of 164 home health and hospice facilities across 19 states, marks a significant step in addressing antitrust concerns in the healthcare sector. This post explores the background of the lawsuit, the rejected remedies, the details of the divestiture, and the lessons learned about the DOJ’s preference for structural remedies.

Background of the Lawsuit

In June 2023, UnitedHealth’s subsidiary Optum agreed to acquire Amedisys, a leading home health and hospice provider based in Baton Rouge, Louisiana, for $3.3 billion. UnitedHealth, headquartered in Eden Prairie, Minnesota, is a vertically integrated healthcare giant, operating as an insurer, provider, pharmacy benefit manager, and healthcare software vendor. The acquisition raised red flags for the DOJ, particularly because UnitedHealth had acquired Amedisys’s primary competitor, LHC Group, in 2023 for $5.4 billion. The DOJ, joined by four states, filed a lawsuit in November 2024 in the U.S. District Court for the District of Maryland to block the merger, arguing it would significantly reduce competition in the home health and hospice markets.

The DOJ’s concerns centered on the potential for UnitedHealth to dominate the market, controlling 30% or more of home health or hospice services in eight states and expanding into five additional states for the first time. The lawsuit claimed the merger would harm hundreds of thousands of vulnerable patients by limiting access to affordable, high-quality care and reducing wage competition for thousands of nurses. The DOJ labeled the deal “presumptively anticompetitive and illegal,” citing its potential to consolidate nearly 800 local home health and hospice markets.

In addition, the DOJ forced UnitedHealth to abandon acquisitions plans for other providers.

Rejected Remedies

To address the DOJ’s concerns, UnitedHealth and Amedisys proposed multiple divestiture plans, but at least two were publicly rejected. The first, proposed in the summer of 2024, involved selling assets to VCG Luna, a subsidiary of Texas-based VitalCaring Group. The DOJ rejected this plan, deeming VCG Luna an unreliable buyer to maintain competition in the affected markets. The second attempt, in spring 2025, involved divestitures to BrightSpring Health Services and The Pennant Group. This proposal was also rejected, as it failed to fully address the DOJ’s concerns about market consolidation. These rejections underscored the DOJ’s rigorous standards for ensuring that divestitures restore competition effectively.

The Approved Divestiture and Remedy

The proposed settlement, filed on August 7, 2025, resolves the DOJ’s concerns by requiring UnitedHealth and Amedisys to divest 164 home health and hospice locations, including one palliative care facility, across 19 states. These facilities generate approximately $528 million in annual revenue, making this the largest divestiture of outpatient healthcare services to resolve a merger challenge. The divested assets will be sold to BrightSpring Health Services and The Pennant Group, with BrightSpring acquiring 115 sites and Pennant acquiring 49, primarily home health facilities.

The settlement includes several key provisions to ensure competitive balance:

• Additional Divestitures: UnitedHealth must divest eight additional locations if regulatory approval for the initial 164 facilities is not obtained.
• Oversight: A monitor will supervise the divestiture process and ensure compliance with the consent decree.
• Support for Buyers: The agreement provides buyers with the assets, personnel, and relationships needed to compete effectively against UnitedHealth in overlapping markets.
• Antitrust Compliance: Amedisys will pay a $1.1 million civil penalty for falsely certifying compliance with the Hart-Scott-Rodino Act and must train its leadership on antitrust compliance.

The divestitures, concentrated in the Southeast where UnitedHealth’s LHC Group has a strong presence, aim to preserve competition for patients and nurses. The settlement also requires UnitedHealth to divest stakes in 10 joint ventures and includes protections to prevent interference with the buyers’ ability to compete. The proposal is subject to a 60-day public comment period under the Tunney Act, after which a Maryland district judge will determine if it serves the public interest.

Lessons Learned: The DOJ’s Preference for Structural Remedies

The UnitedHealth-Amedisys settlement highlights the DOJ Antitrust Division’s strong preference for structural remedies over behavioral ones in merger cases. Structural remedies, such as divestitures, physically alter the market by transferring assets to new competitors, ensuring long-term competition without ongoing oversight. In this case, the DOJ rejected earlier proposals that did not sufficiently restore competition, opting instead for a robust divestiture of 164 facilities to established players like BrightSpring and Pennant. The DOJ’s insistence on structural remedies reflects its belief that competition in healthcare is critical to protecting vulnerable patients and workers. By requiring divestitures across 19 states, the DOJ ensures that the home health and hospice markets remain competitive.

Andre Barlow

202-589-1838

abarlow@dbmlawgroup.com