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UnitedHealth Completes Sierra Health Deal

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A health insurance giant has had to make only a small adjustment in deal terms to close on a Mountain State acquisition.

UnitedHealth Group Inc., Minnetonka, Minn., reported Monday that it had received the final approvals it needed from the U.S. Department of Justice to acquire Sierra Health Services Inc., Las Vegas, for about $2.6 billion in cash.

UnitedHealth provides or administers major medical coverage for 31 million U.S. residents, while Sierra Health provides or administers health coverage for only about 860,000 people.

Nevada medical societies and consumer groups had objected to the deal, contending that the acquisition would give UnitedHealth a dominant position in the Las Vegas group health market and an overwhelming edge in the Las Vegas health maintenance organization plan market.

In the end, the Justice Department required UnitedHealth to divest just 2 small UnitedHealth Medicare HMO plans before completing the deal.

The Medicare HMO plans, in Clark County, Nev., and Nye County, Nev., have just 25,000 members, UnitedHealth reports.

Humana Inc., Louisville, Ky., has agreed to buy the plans from UnitedHealth for about $185 million in cash.

In a separate arrangement, UnitedHealth and Sierra Health have won approval of the deal from Nevada Attorney General Catherine Cortez by agreeing that UnitedHealth will donate $15 million to Nevada charities over the next 5 years to help Nevada health care consumers and Nevada health care programs, the companies report.