Health care deal gets challenge

CARSON CITY -- A big union, national, state and local medical groups, a local government official and a U.S. House panel filed documents Thursday in Washington, D.C., in efforts to block the biggest health care deal in Nevada history.

The documents filed with the federal Justice Department and U.S. District Court oppose the $2.6 billion purchase of Las Vegas-based Sierra Health Services by Minnesota-based UnitedHealth Group.

Those opposing the deal include Service Employees International Union Nevada, which represents thousands of health care workers in Nevada, the American Medical Association, Nevada State Medical Association and Clark County Medical Association.

Also fighting the acquisition are Clark County Commissioner Chris Giunchigliani and the U.S. House Committee on Small Business.

The Justice Department already has said it will allow UnitedHealth to go forward with the purchase, but only if the companies divest assets related to UnitedHealth's Las Vegas Medicare Advantage.

Officials for the two companies promised to comply with the required divestiture as well as the Nevada attorney general's demand that United Health contribute million of dollars to charities in the state to demonstrate it would be "a good corporate citizen."

But Jane McAlevey, head of SEIU Nevada, said the deal still leaves "hundreds of thousands of Las Vegas consumers vulnerable to UnitedHealth's unbridled market power; and Giunchigliani said UnitedHealth has a "horrific track record of business practices that are bad for patients and bad for providers."

The physician organizations said the deal would enable UnitedHealth to acquire a 90 percent share of the health maintenance organization market, and the Justice Department "dropped the ball" in letting the acquisition proceed.

The House Committee on Small Business contends that a combined United-Sierra would have an overwhelming market share and that could lead to reduced compensation for health care providers. The panel also said the result could be reduced access to health care.

Ken Burdick, CEO of UnitedHealth, has said the combined companies will offer Nevadans "affordable, high-quality health care" and "the most comprehensive range of cost-effective, innovative health care products and services in the Southwest."

Burdick and Jonathon Bunker, president and COO of Sierra, said they also would make $15 million in charitable contributions over the next five years to benefit health care consumers and programs in Nevada.

The acquisition was approved by Nevada's insurance commissioner after representatives of the two companies said Sierra Health would retain its own leadership and expand services without raising rates.

Going into the deal, Sierra Health had more than 300,000 members in employer-sponsored plans in Nevada and another 320,000 people in plans for retirees and government workers.

UnitedHealth Group, the largest health insurer in the United States, is headquartered in Minnetonka, Minn. In 2007, United reported revenues of approximately $75 billion.