Centene's Illinois Subsidiary to Acquire Membership of NextLevel Health Partners

Rhea-AI Summary

Centene Corporation's Illinois subsidiary, Meridian Health Plan, has entered into a Member Transfer Agreement to acquire 100% of NextLevel Health Partners, bringing in approximately 54,000 Medicaid members from Cook County. This agreement includes a care coordination contract with NLHP to ensure continuity of care. Centene previously supported NLHP's establishment and has helped operationally since its inception in 2017. The transaction is anticipated to close in July 2020, pending regulatory approvals, enhancing Centene's footprint in the Illinois Medicaid market.

Positive

• Acquisition expands Meridian's Medicaid membership by 54,000, boosting its presence in Cook County.
• Continued support through a care coordination agreement ensures quality care for members.

Negative

• None.

ST. LOUIS, June 30, 2020 /PRNewswire/ -- Centene Corporation (NYSE: CNC) announced today that its Illinois subsidiary, Meridian Health Plan of Illinois, Inc. ("Meridian"), and NextLevel Health Partners, Inc. ("NLHP"), a health plan serving Medicaid members in Cook County, Illinois, have entered into a Member Transfer Agreement. Under the agreement, Meridian will be assigned 100% of NLHP's approximately 54,000 members who access benefits from the Illinois Department of Healthcare and Family Services' HealthChoice Illinois Program.

As part of the agreement, Meridian has executed a care coordination agreement with NLHP to ensure continuity of care for a subset of the assigned membership, effective concurrently with the closing of the transaction. 

Centene provided the initial capital NLHP needed to obtain its HMO licensure at the end of 2017, enabling a minority-owned and -operated health plan to participate in the Illinois Medicaid program. Since then, Centene has continued to provide operational support to NLHP.  

"We are pleased to continue to support NextLevel Health Partners by entering into a care coordination agreement, while expanding our presence in Cook County and working with our members, providers and government partners to achieve better health outcomes at lower costs for the state of Illinois," said Michael F. Neidorff, Chairman, President and CEO of Centene. "We look forward to leveraging our scale and continuing to grow our relationships with these valued partners."

"NextLevel Health's local, community-based approach combines a culturally sensitive lens and the recognition of social determinants of health," said Dr. Cheryl Whitaker, Chief Executive Office and Chairwoman of NextLevel Health Partners, Inc. "We are pleased to transition to providing care coordination to help ensure our members continue receiving quality care that improves the health of communities across Cook County." 

Meridian has been serving the Medicaid population in Illinois since 2008 and currently serves more than 750,000 HealthChoice members in Illinois.

The transaction is expected to close in July 2020, subject to regulatory approvals.

About Centene Corporation
Centene Corporation, a Fortune 50 company, is a leading multi-national healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach – with local brands and local teams - to provide fully integrated, high-quality, and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured and uninsured individuals. Centene offers affordable and high-quality products to nearly 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace, the TRICARE program, and individuals in correctional facilities. The Company also serves several international markets, and contracts with other healthcare and commercial organizations to provide a variety of specialty services focused on treating the whole person. Centene focuses on long-term growth and the development of its people, systems and capabilities so that it can better serve its members, providers, local communities, and government partners.

Centene uses its investor relations website to publish important information about the company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, http://www.centene.com/investors.

Forward-Looking Statements
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In particular, these statements include, without limitation, statements about our future operating or financial performance, market opportunity, growth strategy, competition, expected activities in completed and future acquisitions, including statements about the impact of our recently completed acquisition (the WellCare Acquisition) of WellCare Health Plans, Inc. (WellCare), other recent and future acquisitions, investments and the adequacy of our available cash resources. These forward-looking statements reflect our current views with respect to future events and are based on numerous assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, business strategies, operating environments, future developments and other factors we believe appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties and are subject to change because they relate to events and depend on circumstances that will occur in the future, including economic, regulatory, competitive and other factors that may cause our or our 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. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions. All forward-looking statements included in this press release are based on information available to us on the date hereof. Except as may be otherwise required by law, we undertake no obligation to update or revise the forward-looking statements included in this press release, whether as a result of new information, future events or otherwise, after the date hereof. You should not place undue reliance on any forward-looking statements, as actual results may differ materially from projections, estimates, or other forward-looking statements due to a variety of important factors, variables and events including but not limited to: the impact of COVID-19 on global markets, economic conditions and the healthcare industry and our results of operations, which is unknown, uncertainty as to our expected financial performance following completion and integration of the WellCare Acquisition; the possibility that the expected synergies and value creation from the WellCare Acquisition will not be realized, or will not be realized within the expected time period; the risk that unexpected costs will be incurred in connection with the integration of the WellCare Acquisition or that the integration of WellCare will be more difficult or time consuming than expected; unexpected costs, charges or expenses resulting from the WellCare Acquisition; the inability to retain key personnel; disruption from the completion of the WellCare Acquisition, including potential adverse reactions or changes to business relationships with customers, employees, suppliers or regulators, making it more difficult to maintain business and operational relationships; the risk that we may not be able to effectively manage our expanded operations; our ability to accurately predict and effectively manage health benefits and other operating expenses and reserves; competition; membership and revenue declines or unexpected trends; changes in healthcare practices, new technologies, and advances in medicine; increased healthcare costs; changes in economic, political or market conditions; changes in federal or state laws or regulations, including changes with respect to income tax reform or government healthcare programs as well as changes with respect to the Patient Protection and Affordable Care Act and the Health Care and Education Affordability Reconciliation Act, collectively referred to as the Affordable Care Act (ACA) and any regulations enacted thereunder that may result from changing political conditions or judicial actions, including the ultimate outcome in "Texas v. United States of America" regarding the constitutionality of the ACA; rate cuts or other payment reductions or delays by governmental payors and other risks and uncertainties affecting our government businesses; our ability to adequately price products on the Health Insurance Marketplaces and other commercial and Medicare products; tax matters; disasters or major epidemics; the outcome of legal and regulatory proceedings; changes in expected contract start dates; provider, state, federal and other contract changes and timing of regulatory approval of contracts; the expiration, suspension, or termination of our contracts with federal or state governments (including but not limited to Medicaid, Medicare, TRICARE or other customers); the difficulty of predicting the timing or outcome of pending or future litigation or government investigations; challenges to our contract awards; cyber-attacks or other privacy or data security incidents; the possibility that the expected synergies and value creation from acquired businesses, including businesses we may acquire in the future, will not be realized, or will not be realized within the expected time period; the exertion of management's time and our resources, and other expenses incurred and business changes required in connection with complying with the undertakings in connection with any regulatory, governmental or third party consents or approvals for acquisitions; disruption caused by significant completed and pending acquisitions, including, among others, the WellCare Acquisition, making it more difficult to maintain business and operational relationships; the risk that unexpected costs will be incurred in connection with the completion and/or integration of acquisition transactions; changes in expected closing dates, estimated purchase price and accretion for acquisitions; the risk that acquired businesses will not be integrated successfully; the risk that we may not be able to effectively manage our operations as they have expanded as a result of the WellCare Acquisition; restrictions and limitations in connection with our indebtedness; our ability to maintain or achieve improvement in the Centers for Medicare and Medicaid Services (CMS) Star ratings and maintain or achieve improvement in other quality scores in each case that can impact revenue and future growth; availability of debt and equity financing, on terms that are favorable to us; inflation; foreign currency fluctuations; and risks and uncertainties discussed in the reports that Centene has filed with the Securities and Exchange Commission. This list of important factors is not intended to be exhaustive. We discuss certain of these matters more fully, as well as certain other factors that may affect our business operations, financial condition and results of operations, in our filings with the Securities and Exchange Commission (SEC), including our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. Due to these important factors and risks, we cannot give assurances with respect to our future performance, including without limitation our ability to maintain adequate premium levels or our ability to control our future medical and selling, general and administrative costs.

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SOURCE Centene Corporation

FAQ

What is the value of the agreement between Centene's Meridian and NextLevel Health Partners?

The agreement involves the transfer of approximately 54,000 Medicaid members but does not specify a transaction value.

What does the Member Transfer Agreement entail for Centene?

It allows Centene's Meridian to acquire all members of NextLevel Health Partners, enhancing its Medicaid services in Cook County.

When is the expected closing date for the Centene and NextLevel Health Partners agreement?

The transaction is expected to close in July 2020, subject to regulatory approvals.

How will the acquisition impact Centene's market presence in Illinois?

The acquisition will significantly expand Centene's Medicaid membership and operational capacity in Illinois, particularly in Cook County.

What kind of support has Centene provided to NextLevel Health Partners?

Centene provided initial capital for NLHP's HMO licensure in 2017 and ongoing operational support since then.