Aetna will spend about $35 billion to buy rival Humana and become the latest health insurer bulking up on government business as the industry adjusts to the federal health care overhaul.
The proposed cash-and-stock deal, announced early Friday, would make Aetna a sizable player in the rapidly growing Medicare Advantage business, which offers privately run versions of the federally funded health care program for the elderly and some people with disabilities.
Humana has nearly 3.2 million people enrolled in Medicare Advantage plans, a total that falls just sort of market leader UnitedHealth Group Inc.
The combination also would bolster Aetna's presence in the state- and federally funded Medicaid program and Tricare coverage for military personnel and their families.
The deal value totals about $37 billion counting debt.