Capitol Correspondence - 04.01.19

Centene Acquires WellCare, Creating Large Managed Care Organization Covering Medicaid and ACA

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As shared by Politico Pro:

“Centene is acquiring WellCare for $17.3 billion, creating a Medicaid and Obamacare powerhouse that will have 22 million members across all fifty states and combined revenue of nearly $100 billion, the companies announced today.

Centene’s bread and butter is Medicaid managed care, where it had about 14 million members at the end of last year.

But the insurer has also emerged as a major player in the Obamacare markets, with nearly 2 million members across 21 states at the start of this year — nearly one in five exchange enrollees nationwide. The company hired Kevin Counihan, who headed in the Obama administration, to oversee its individual market business, and has been consistently bullish on the struggling markets.

‘We have not been distracted by ACA legal headlines,’ Centene CEO Michael Neidorff said on a call with investors last month, referring to a federal judge’s ruling — now backed by the Trump administration — that the entire federal health care law is unconstitutional and must be scrapped.

‘We expect to have another strong year of operations in our industry-leading marketplace business.’

Centene has grown rapidly in recent years, with its stock price more than tripling since 2014. In 2016, the company acquired Health Net, another significant Medicaid managed care plan, for $6.3 billion.

WellCare had 5.5 million members at the end of last year.”