Wel­lCare com­pletes pur­chase of Care1st Ari­zona health plan

Modern Healthcare - - REGIONAL NEWS -

Wel­lCare Health Plans has com­pleted its ac­qui­si­tion of Care1st Health Plan of Ari­zona.

The $157.5 mil­lion deal marks Wel­lCare’s en­trance into the Ari­zona Med­i­caid man­aged-care mar­ket.

Care1st Ari­zona is a sub­sidiary of Care1st Health Plan, a Cal­i­for­nia-based in­surer that Blue Shield of Cal­i­for­nia bought for $1.25 bil­lion last Oc­to­ber. Care1st Ari­zona pro­vides Med­i­caid cov­er­age to 112,000 peo­ple in the state’s two largest coun­ties and also has a small Medi­care Ad­van­tage spe­cial needs plan that cov­ers 2,000 peo­ple. Wel­lCare serves ap­prox­i­mately 3.8 mil­lion mem­bers na­tion­wide as of Septem­ber 2016.

“This ac­qui­si­tion marks our en­trance into our 11th Med­i­caid state, fur­ther ge­o­graph­i­cally di­ver­si­fy­ing our busi­ness in an at­trac­tive mar­ket,” said Ken Bur­dick, Wel­lCare’s CEO.

Scott Cum­mings, who was pre­vi­ously chief ad­min­is­tra­tive of­fi­cer for Care1st Ari­zona, has been named Wel­lCare’s state pres­i­dent of Ari­zona.

Care1st Ari­zona is ex­pected to add about $400 mil­lion in pre­mium rev­enue to Wel­lCare, ac­cord­ing to Wall Street pro­jec­tions. Wel­lCare, which also sells Medi­care Ad­van­tage and Medi­care Part D pre­scrip­tion drug plans, posted $3.6 bil­lion in rev­enue for the first half of its fis­cal year.

Wel­lCare re­cently signed new Med­i­caid con­tracts with Ne­braska and Ge­or­gia, but the com­pany has en­coun­tered prob­lems in other states. Iowa kicked out Wel­lCare from its new Med­i­caid pri­va­ti­za­tion pro­gram, cit­ing dis­clo­sure and ethics lapses. Wel­lCare also lost out on Penn­syl­va­nia’s man­aged long-term ser­vices and sup­ports. The plan is join­ing Aetna Bet­ter Health, Molina Health­care of Penn­syl­va­nia, Gate­way Health Plan of High­mark and Mercy Health Sys­tem of South­east­ern Penn­syl­va­nia in ap­peal­ing the Penn­syl­va­nia de­ci­sion.

Wel­lCare CEO Ken Bur­dick

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.