Tampa-based WellCare Health Plans has entered into a definitive agreement to acquire Meridian Health Plans of Michigan and Illinois, and pharmacy benefit manager (PBM) MeridianRx for $2.5 billion in cash.
The transaction is expected to close by the end of 2018. The deal strengthens WellCare's Medicaid and Medicare Advantage businesses in the two states, while adding an integrated PBM platform that provides a range of services and product offerings to both Meridian's members and third parties.
Meridian is one of the largest privately held, for-profit managed care organizations in the US and serves approximately 1.1 million Medicaid, Medicare Advantage, integrated dual-eligible and Health Insurance Marketplace members in Michigan, Illinois, Indiana and Ohio.
Meridian expects to generate more than $4.3 billion in total revenue in 2018. The company has approximately 508,000 Medicaid members in Michigan and 565,000 Medicaid members in Illinois as of May 1, 2018.
"This transaction strategically aligns with our focus on government-sponsored health plans, will strengthen our capabilities and growing business, and will meaningfully advance our growth agenda," said WellCare CEO Ken Burdick. "Meridian is a well-performing health plan, and WellCare and Meridian share a similar commitment to serving our members through a comprehensive, integrated approach to healthcare."
Meridian CEO David Cotton said: "WellCare's unwavering commitment to improving the lives of its members makes it an ideal partner. Our similar missions, values and goals, combined with WellCare's dedication to providing an unparalleled member experience, including access to high quality healthcare, were key factors in our decision."
Healthcare, Meridian, WellCare, Health plans, Medicaid, Agreement, Acquisition, Ken Burdick, David Cotton, US