CVS enters new deal with Centene
CVS Health is acquiring Centene’s Illinois health plan subsidiary, IlliniCare Health Plan, the companies announced Dec. 2. Financial terms of the transaction were not disclosed.
The agreement is in connection with the previously announced merger between Centene and WellCare Health Plans. Centene and WellCare announced their merger in June and expect to close the deal, valued at $17.3 billion, in the first half of 2020. Centene, a Fortune 100 company, provides healthcare services and health plans and is one of the largest health insurers in the U.S.
WellCare, a Tampa, Fla.-based managed care services company, acquired the Medicare Part D prescription drug business of Aetna in 2018 as part of a divestiture mandated by the Department of Justice during the $69 billion merger between Aetna and CVS Health.
CVS is acquiring Centene’s Medicaid and Medicare Advantage businesses in Illinois in the deal, while Centene will keep IlliniCare’s Medicare-Medicaid Alignment Initiative business and its statewide YouthCare foster care contract, which begins February 2020.
"We are continuing to make progress towards completing our transaction with WellCare and the divestiture of our IlliniCare Health plan is the next step in that process," Michael F. Neidorff, Centene's chairman, president and CEO, said in a statement. "We will work closely with CVS Health to ensure a smooth transition of this business for members, employees and providers."
The deal between CVS and Centene is subject to federal and state regulatory clearance as well as other customary closing conditions, including the closing of the WellCare-Centene merger. The merger has already received approval from 26 states.
"Expanding our Medicaid and Medicare Advantage presence in Illinois will allow us to serve more members with our proven holistic approach that addresses physical, behavioral and social determinants of care," Karen S. Lynch, executive vice president of CVS Health and president of Aetna, said in a statement. "We look forward to working with Centene on a seamless transition and developing a deeper relationship with the state and local providers."
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."