Centene Corporation to Acquire Medicaid Health Plan in South Carolina
February 18 2010 - 8:00AM
PR Newswire (US)
Attains Long Term Membership Growth Target ST. LOUIS, Feb. 18
/PRNewswire-FirstCall/ -- Centene Corporation (NYSE: CNC) today
announced that its South Carolina subsidiary, Absolute Total Care,
has signed a definitive agreement to acquire Columbia-based
Carolina Crescent Health Plan (CCHP), the state's largest
non-profit Medicaid managed care organization, from University
Health Services, Inc. (UHS). CCHP serves more than 40,000 Medicaid
members in 46 counties across the state. Consistent with Centene's
stated goal of growing its South Carolina plan to cover between
10-15 percent of the eligible Medicaid population, Absolute Total
Care expects to provide managed care services for approximately
90,000 Medicaid members after the acquisition, or approximately 13
percent of the state's eligible Medicaid population. The
transaction is contingent on receiving approval from state
regulators and is expected to close in the third quarter of this
year. The addition of the CCHP membership to Absolute Total Care
will enable the company to leverage its care management
capabilities across nearly twice as many members, with the
potential to significantly improve health outcomes and reduce costs
for the state's Medicaid members. Absolute Total Care will work
closely with CCHP to ensure a seamless transition for members,
providers and other stakeholders. "The expansion of our South
Carolina operations is consistent with our strategy to effectively
and prudently deploy capital to grow our business," said Centene
Chairman and Chief Executive Officer Michael F. Neidorff. "Like all
accretive acquisitions, this transaction will allow us to leverage
our business platform and systems across a broader member base,
enabling us to provide better service at lower cost to our
customers. Our ongoing leadership in providing managed care by
working locally with the state, the health care providers and our
members serves to improve health outcomes in a cost effective
manner." The acquisition of CCHP is expected to add revenues in the
range of $55-65 million for 2010 and $115-130 million on an annual
basis. Including transaction costs, the company expects the
acquisition to be accretive to earnings by approximately $0.02-0.03
per share in 2010, and accretive by approximately $0.09-0.11 per
share on an annual basis. About Centene Corporation Centene
Corporation is a leading multi-line healthcare enterprise that
provides programs and related services to individuals receiving
benefits under Medicaid, including the State Children's Health
Insurance Program (SCHIP), as well as Aged, Blind, or Disabled
(ABD), Foster Care, Long-Term Care and Medicare (Special Needs
Plans). The Company operates local health plans and offers a wide
range of health insurance solutions to individuals and the rising
number of uninsured Americans. It also contracts with other
healthcare and commercial organizations to provide specialty
services including behavioral health, life and health management,
managed vision, nurse triage, pharmacy benefits management and
treatment compliance. Information regarding Centene is available
via the Internet at http://www.centene.com/. The information
provided in this press release contains forward-looking statements
that relate to future events and future financial performance of
Centene. Subsequent events and developments may cause the Company's
estimates to change. The Company disclaims any obligation to update
this forward-looking financial information in the future. Readers
are cautioned that matters subject to forward-looking statements
involve known and unknown risks and uncertainties, including
economic, regulatory, competitive and other factors that may cause
Centene's or its industry's actual results, levels of activity,
performance or achievements to be materially different from any
future results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements. Actual
results may differ from projections or estimates due to a variety
of important factors, including Centene's ability to accurately
predict and effectively manage health benefits and other operating
expenses, competition, changes in healthcare practices, changes in
federal or state laws or regulations, inflation, provider contract
changes, new technologies, reduction in provider payments by
governmental payors, major epidemics, disasters and numerous other
factors affecting the delivery and cost of healthcare. The
expiration, cancellation or suspension of Centene's Medicaid
Managed Care contracts by state governments would also negatively
affect Centene. DATASOURCE: Centene Corporation CONTACT: Media,
Toni Simonetti, +1-314-740-3039, or Investors, Edmund E. Kroll,
+1-212-759-0382, both of Centene Corporation Web Site:
http://www.centene.com/
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