Will the court ruling kill Aetna-Humana deal?

A federal judge ruled Monday in favor the U.S. Justice Department in its bid to block the proposed $37 billion merger of health insurance giants Aetna and Louisville-based Humana.

What does it mean? Here are some insights from the ruling and beyond that illuminate the road ahead.

The ball is now in the companies' court. 

Other trial court rulings in antitrust cases for the challengers have doomed big mergers. The trouble is that such deals tend to force companies to postpone moves that maintain their competitive edge. That makes it more difficult for the suitor to keep the engagement together. Aetna spokesman T.J. Crawford was blunt in saying that his company's lawyers and Humana's had made a "compelling" case for allowing the deal to go through, and would consider an appeal. If the parties don't make an announcement before Jan. 31, Aetna's executives are sure to face a barrage of questions on their next moves when the Hartford, Connecticut-based insurer released its earnings.

If they decide to do battle, there's more uncertainty ahead.

The last thing companies want to do is run up the meter in time and cash for more litigation. The merger was set to close more than a year ago, then extended to mid-summer 2016. Then, recognizing trial court Judge John Bates wouldn't rule until the end of this month, Aetna and Humana set Feb. 15 for the deadline on their agreement. A $1 billion breakup fee was agreed to in the original sale document, which ensured the companies stayed together in trying to gain approval for the deal.

If the companies decide to appeal, they're rolling the dice that a three-judge federal appeals court panel will overturn Bates' thorough ruling.

► LOOK BACK: How Humana grew from a single nursing home

The Molina sell-off was a big risk from the beginning.

A chunk of the trial in Washington, D.C., was devoted to the companies' plans to selling off business with 290,000 Medicare Advantage customers to Molina Healthcare of California. But the government's lawyers presented evidence during the trial that Molina seemed overwhelmed by the prospect of assuming the business and also wary of the "fire sale" prices offering by the big companies. The point was to eliminate overlaps in key counties. During closing arguments, DOJ's lawyers insisted that consumers stood to really lose by the solution offered by Molina.

As it turned out, Bates didn’t buy the companies' assertions that it would work. He wrote that without Aetna’s or Humana’s provider contracts, Molina stood at a disadvantage. It would have to start "from scratch” in 364 counties and in 325 “of which it has no presence whatsoever,” Bates wrote.

What's ahead for the 100,000 employees of Aetna and Humana?

Both companies' workforces of about 50,000 deserve some sympathy, They've been given some information about what their employers are doing to further the merger, but reportedly little has been revealed to them about precisely whether the hundreds of millions of dollars in "synergies" mentioned to investors and in court documents after the sale closes means to jobs in Hartford or Louisville. Some talent in IT and other segments of the Louisville payroll bailed more than a year ago, unwilling to sit pat with the uncertainties. Even if Aetna were allowed to execute its plans, it's not clear whether the 13,000 positions they expect to maintain will be as high-paying as those centered around the headquarters.

Analysts who watch mergers and acquisitions have said the many of the top jobs, in legal, product development, marketing and the like tend to be clustered around the company headquarters, not the subsidiary locations.

Prediction: A Trump administration can't make a deal for the companies.

President Donald Trump has appointed a cabinet bent on rolling back what it sees as burdensome regulation. But that may not change the course of this case. Antitrust lawyer David Balto, who has tracked the Aetna-Humana and Anthem-Cigna cases on behalf of a coalition of consumer groups, has said that federal antitrust litigation tends to be nonpartisan. Thus, Trump's administration is free to go after health care reform, but it won't be in a position to alter the course of the pending litigation.

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Reporter Grace Schneider can be reached at 502-582-4082 or gschneider@courier-journal.com.