Nevada regulator OKs merger of United, Sierra

UnitedHealth Group's purchase of Sierra Health Services still needs federal approval, and the fight over the deal in Nevada isn't done just yet.

By Bob Cook, AMNews staff. Sept. 17, 2007.

UnitedHealth Group's acquisition of a Nevada health plan has cleared its first regulatory hurdle, despite the opposition of organized medicine, unions and many of the state's own politicians. Those opponents -- including Nevada's governor -- are not done fighting the deal.

Gov. Jim Gibbons, a Republican, says he wants state Attorney General Catherine Cortez Masto, a Democrat, to look at whether anything can be done to block United's $2.6 billion buyout of Las Vegas-based Sierra Health Services in light of its Aug. 27 approval by the state's insurance commissioner.

State insurance commissioners in California and Arizona, where Sierra has Medicare Part D operations, still must approve the merger, which they are expected to do. The Dept. of Justice must also approve the merger -- and it rarely even puts conditions on health-plan mergers, much less rejects them.

"I am deeply disturbed by some of the potential monopolistic tendencies that can result from this merger and by the constraints in Nevada law that prevented the insurance commissioner from acting more forcefully to curb these potential threats," Gibbons said in a prepared statement. "I urge the attorney general to work with my office to take any and all legal steps to prevent adverse outcomes and will also urge the Justice Dept. to closely examine the monopolistic potential in their review of this merger."

The attorney general's office is expected to announce by the end of September whether it will sue to block the deal.