UnitedHealth Group Amedisys Merger Faces Further Delays

by Kristin Rowan | Jan 9, 2025 | M&A, Regulatory

by Kristin Rowan, Editor

UHG and Amedisys Waive Termination

The UnitedHealth Group and Amedisys merger has been an ongoing story since the initial merger agreement was signed in June of 2023. The proposed merger came under scrutiny by the Federal Trade Commission (FTC) and the Department of Justice (DOJ). UnitedHealth Group and Amedisys are competitors in the home healthcare market and the merger would hurt patients.

“UnitedHealth’s plan to extinguish Amedisys as a competitor is the result of an intentional, sustained strategy of acquiring, rather than beating, competition.”

Department of Justice

DOJ Pushes Back

Late in 2024, the DOJ filed a lawsuit against the merger, claiming that both companies have acknowledged that their competition helps keep them honest and drive quality both in patient and employee care. The DOJ noted that the acquisition would be presumptively illegal in multiple markets. UHG, Amedisys, and Optum proposed selling off some of its care centers to address the concerns about competition.

Merger Deadline Reached

Under the initial merger agreement, UHG would pay $3.3 billion to acquire Amedisys, which would remain as a subsidiary of UHG. That agreement was set to be finalized on December 27, 2024. There has been no decision made on the DOJ lawsuit, so the merger could not be completed. UHG and Amedisys have mutually agreed to extend the merger and added a break fee of $275 million.

Indefinite Merger Extension Through 2025

The new agreement has an indefinite ending. According to the wording, the merger agreement will now expire either on December 31, 2025 or 10 days after a final court decision in the lawsuit, whichever comes first.

According to the new filing with the SEC, UnitedHealth and Amedisys will be divesting assets to secure the merger and satisfy the DOJ. If not, they will incur a break fee of up to $325 million. Both companies have an agreement with VitalCaring Group to acquire the necessary assets.

What If?

If…The Trump administration is less stringent in antitrust matters, as expected.

The lawsuits currently at the U.S. District Court and five states will likely fail.

If…the U.S. District Court for the District of Maryland either decides to block the merger permanently or does not reach a final order by the end of the year…

The merger agreement will expire.

If…UnitedHealth Group, Optum, and/or Amedisys fails to divest holdings…

The merger agreement will not satisfy the antitrust regulations and the failing party will pay hundreds of millions in damages, and the merger agreement will end.

This is an ongoing story and we will continue to report on updates as they occur. See our accompanying BREAKING NEWS story.

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Kristin Rowan has been working at Healthcare at Home: The Rowan Report since 2008. She has a master’s degree in business administration and marketing and runs Girard Marketing Group, a multi-faceted boutique marketing firm specializing in event planning, sales, and marketing strategy. She has recently taken on the role of Editor of The Rowan Report and will add her voice to current Home Care topics as well as marketing tips for home care agencies. Connect with Kristin directly kristin@girardmarketinggroup.com or www.girardmarketinggroup.com

©2025 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in The Rowan Report. One copy may be printed for personal use: further reproduction by permission only. editor@therowanreport.com

NonCompete Agreements and What to do About Them

by Elizabeth E. Hogue, Esq. | Sep 12, 2024 | Admin, Clinical, Regulatory

by Elizabeth E. Hogue, Esq.

What to do About Noncompete Agreements

The Federal Trade Commission (FTC) published a final rule earlier this year that banned noncompete agreements. The final rule was effective on September 4, 2024.

Requirements of the rule included:

- A ban on new concompete agreements with all workers, including senior executives
- Existing noncompete agreements could remain in force for senior executives if
  - they make more than $151,164 per year including salary, commissions, and performance bonuses but not including benefits, board and lodging; and
  - senior executives have authority to make policy decisions for the entire company
- Existing noncompete agreements with workers other than senior executives are unenforceable after the rule is effective

There are a number of exceptions to the rule.

In the meanwhile, litigation

On July 23, 2024, a federal court in Pennsylvania refused to issue a preliminary injunction to prevent implementation of the final FTC rule. The U.S. District Court for the Eastern District of Pennsylvania said that the statutory authority of the FTC to prevent unfair methods of competition under Section 5 of the FTC Act is not limited to procedural rules for adjudications and extends to substantive rulemaking [See ATS Tree Servs. v. Fed. Trade Comm’n, No. 24-1743 (E.D. Pa. July 23, 2024)].

But...

In early July, a federal court in Texas granted a preliminary injunction that delayed the effective date of the final rule. The Court declined to issue a nationwide injunction [See Ryan LLC v. Federal Trade Comm’n, No. 3:24-CV-00986-E (N.D. Tex. July 3, 2024)].

Then, on August 20, 2024, the Judge issued an order in the Ryan case that included a nationwide prohibition on implementation of the FTC rule. The basis of this decision is that the FTC does not have authority to order a ban, and that the rule was arbitrary and capricious. Based on this ruling, employers may continue to enter into and enforce non-compete agreements with workers.

Another but...

A number of state legislatures have enacted restrictions on use of noncompete agreements. As of August 21, 2024, four states ban the use of noncompete agreements and thirty-three states plus the District of Columbia restrict the use of these agreements.

Providers must comply with applicable requirements in the states in which they conduct business. Providers who fail to do so risk enforcement action.

Comfort Keepers, for example, agreed to pay $500,000 to resolve claims that it unfairly restricted workers’ mobility according to the California Department of Justice. Comfort Keepers’ Client Care Agreement that clients were required to sign before receiving care prevented clients from using, hiring, or soliciting current and former Comfort Keepers’ caregivers for up to one year after the termination of services. Violations required payment of $12,500.

So...

The current bottom line is that the FTC rule banning noncompete agreements is not in effect, but providers must comply with applicable state requirements or risk enforcement action.

Stay tuned for more!

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Elizabeth Hogue is an attorney in private practice with extensive experience in health care. She represents clients across the U.S., including professional associations, managed care providers, hospitals, long-term care facilities, home health agencies, durable medical equipment companies, and hospices.

©2024 by The Rowan Report, Peoria, AZ. All rights reserved. This article originally appeared in Healthcare at Home: The Rowan Report. One copy may be printed for personal use: further reproduction by permission only. editor@therowanreport.com

No portion of this material may be reproduced in any form without the advance written permission of the author.

NLRB Targets Non-Compete Agreements

by Elizabeth E. Hogue, Esq. | May 30, 2024 | Admin, Regulatory

by Elizabeth E. Hogue, Esq.

The National Labor Relations Board (NLRB) has now joined the Federal Trade Commission (FTC) and some state legislatures to target non-compete agreements. The general counsel for the NLRB argued in a recent memo that non-compete agreements violate the National Labor Relations Act because they interfere with employees’ right to engage in protected concerted activity. Two recent actions by the Board provide more information about efforts of the NLRB to limit use of non-compete agreements.

Juvly Aesthetics Non-Compete Agreement Settlement

In February of 2024, the regional office of the Board in Cincinnati approved a settlement agreement between Juvly Aesthetics and three former employees. The Board claimed that Juvly, an operator of medical clinics, violated the rights of employees through the use of confidentiality, non-disparagement, non-competition, non-solicitation and requirements to repay training expenses under certain conditions.

According to the NLRB, Juvly prohibited employees from discussing their rates of pay. The Company also required some employees to sign a non-compete agreement that was in effect for a period of twenty-four months for any competing medical practice within twenty miles of any location of the Company.

Juvly agreed to a settlement agreement that required:

Payment of back pay to some employees
Termination of unlawful policies and procedures
Release of employees from unlawful agreements
Posting of all of requirements of the settlement agreements for review by employees

Non-compete agreements juvly aesthetics<br />

NLRB Division of Advice

In December, the NLRB Division of Advice issued guidance that evaluated the legality of these issues:

Customer non-solicitation provisions do not violate the Act because they only prevent employees from soliciting existing customers for one year so that employees are likely not barred from other employment opportunities for more than one year.
Confidentiality agreements do not violate the Act because they prohibit only disclosure of trade secrets, marketing plans, customer lists, and other proprietary information, as opposed to information that could involve employee activity regulated by the Act, such as wage information.
Provisions requiring the return of company property do not violate the Act.

Providers are now clearly operating in an environment that prohibits employers from restricting employee activities that were fair game in the past. The specifics of efforts to limit the actions of employers remain unclear, but will likely be “fleshed out” in enforcement actions.

No portion of this material may be reproduced in any form without the advance written permission of the author.

editor@therowanreport.com