The transaction is being taken up by WellCare in order to get regulatory approval for its £14bn acquisition by Centene
WellCare Health Plans has agreed to offload its Missouri and Nebraska Medicaid plans to rival US health insurance plan provider Anthem for an undisclosed price.
The transaction will be carried out by a subsidiary of WellCare. It is being taken up in order to get regulatory approval of the previously announced $17.3bn (£14.08bn) acquisition of WellCare by Centene in March 2019.
The deal with Anthem will be subject to US federal antitrust clearance, approvals from Missouri and Nebraska regulators, other customary closing conditions, and also the closing of the Centene, WellCare merger.
Anthem president and CEO Gail Boudreaux said: “We look forward to working with our state partners to serve Medicaid members in Missouri and Nebraska with our innovative care management programs designed to improve health outcomes among the most specialized populations.”
Centene said that in connection with the deal, a plan is being developed to make sure that there is a smooth transition for members.
Centene president and CEO Michael Neidorff said: “This transaction demonstrates the strength and quality of WellCare’s Medicaid healthcare plans, and we are pleased to have reached an agreement where the WellCare employees who operate and manage these plans will become part of Anthem and continue providing members and communities with solutions to help them achieve better health outcomes.”
Centene, WellCare are merging to create a major healthcare enterprise
Centene is pursuing the acquisition of WellCare to form a major healthcare enterprise engaged in government-sponsored healthcare programmes and also for becoming a leading provider in Medicaid, Medicare and the health insurance marketplace.
The enlarged health insurance company will operate 31 NCQA accredited health plans and is expected to have more exposure to government-sponsored healthcare solutions through WellCare’s Medicare Prescription Drug Plans and Medicare Advantage.
The proposed merger has been approved by insurance and health care departments across 19 US states. The deal continues to be subject to clearance under the Hart-Scott-Rodino Act, other state regulatory approvals, and customary closing conditions, following which it is likely to be closed by the first half of 2020.