The city has filed an anti-trust lawsuit to block the merger of two of New York’s largest health insurers, claiming the resulting monopoly could cost the city tens of millions of dollars more in insurance premiums.

The insurers, Health Insurance Plan of Greater New York and Group Health Incorporated, provide low-cost coverage to the overwhelming majority of municipal employees. The insurance policies, which do not require employee payroll deductions, cover nearly 453,000 city employees and retirees, according to the legal complaint. The companies are nonprofits.

The city has asked a federal judge, Kenneth Karas of U.S. District Court in Manhattan, to block the merger under federal and state anti-trust acts. Arguments for a temporary injunction to block the merger take place this morning. The merger, announced in 2005, is scheduled to go through tomorrow.

The merger has the approval of the state’s Department of Insurance and the Department of Health. The U.S. Department of Justice has also signed off on it, a spokeswoman for Group Health Incorporated, Ilene Margolin, said.

City lawyers say the resulting business would have no competition and could raise prices without losing customers. The companies have stated their intention to become profit-making entities, city lawyers say, which would require action by the Legislature.

“Under the monopoly conditions that would follow the merger, it can be presumed that the merged entity will raise its prices in the low-cost municipal health benefits market to extracompetitive levels for a period of more than one year,” an affidavit filed in court by a city attorney, John Low-Beer, said.

The city will pay about $3.1 billion for health insurance in the coming fiscal year, according to the court filings. A monopoly low-cost insurance provider could cost the city tens of millions, if not hundreds of millions, of dollars more, according to the city’s filings. If the premiums increase a single percentage it costs the city $27.5 million a year, according to Mr. Low-Beer.

The proposed merger would create the largest health insurer based in New York State, with 4 million customers in the metropolitan area, according to a September 2005 press release announcing the merger. The combined company’s revenue would be more than $7 billion.

The city has been in lengthy discussions with the two companies before filing the lawsuit, city officials said.

“There were discussions about a number of steps we might take to assure them there would be enough scrutiny to keep premium increases to a minimum,” Ms. Margolin said, referring to the city. “We were very disappointed when they decided to go to court.”