CVS Health to acquire IlliniCare Health
Centene has entered into a definitive agreement under which CVS Health will acquire Centene’s Illinois health plan subsidiary, IlliniCare Health Plan. The transaction entails the sale of Centene’s Medicaid and Medicare Advantage lines of business in Illinois.
Centene will retain IlliniCare’s Medicare-Medicaid Alignment Initiative (“MMAI”) business and IlliniCare’s statewide YouthCare foster care contract, set to commence in February 2020. Centene’s Ambetter business in Illinois is not affected. The companies are committed to ensuring that there is a smooth transition for members.
“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,” said Michael F. Neidorff, Centene’s Chairman, President and Chief Executive Officer. “Our employees in Illinois have done an exceptional job serving our communities in the state. We are pleased to enter this agreement with CVS Health, under which these employees can continue helping members achieve better health outcomes while delivering benefits to providers. We will work closely with CVS Health to ensure a smooth transition of this business for members, employees and providers.”
“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,” said Karen S. Lynch, Executive Vice President, CVS Health and President, Aetna. “We look forward to working with Centene on a seamless transition and developing a deeper relationship with the state and local providers.”
The closing of the transaction with CVS Health is subject to U.S. federal antitrust clearance, receipt of Illinois state regulatory approvals and other customary closing conditions, as well as the closing of the Centene – WellCare transaction.
As previously announced on March 27, 2019, Centene and WellCare agreed to combine in a transaction that will create a premier healthcare enterprise focused on government-sponsored healthcare programs and a leader in Medicaid, Medicare and the Health Insurance Marketplace. The combination has received approvals from insurance and health care departments from 26 states. Completion of the Centene – WellCare transaction remains subject to clearance under the Hart-Scott-Rodino Act, receipt of required state regulatory approvals and other customary closing conditions.
Centene and WellCare continue to expect that the Centene – WellCare transaction will be completed by the first half of 2020.
The financial terms of this transaction will not be disclosed and the impact to CVS Health earnings once closed is expected to be immaterial.
