CENTENE SUBSIDIARY MERIDIAN HEALTH PLAN OF ILLINOIS AWARDED CONTRACT TO SERVE DUALLY ELIGIBLE MEDICARE AND MEDICAID MEMBERS ACROSS THE STATE

Rhea-AI Summary

Centene (NYSE: CNC) announced that its subsidiary, Meridian Health Plan of Illinois, has been selected by the Illinois Department of Healthcare and Family Services to continue providing Medicare and Medicaid services through a Fully Integrated Dual Eligible Special Needs Plan (D-SNP).

The new contract will run from January 1, 2026, through December 31, 2029, with potential renewals for up to 10 years total. Meridian is among four health plans chosen to serve 77,000 Medicare-Medicaid-eligible Illinoisans, with an additional 60,000 dually eligible MLTSS individuals joining in 2027.

Currently, Meridian serves over 13,000 Medicaid-Medicare members and more than 11,000 dually eligible MLTSS members through the Illinois HealthChoice Medicaid program. The D-SNP program will provide comprehensive services statewide, focusing on integrating medical, behavioral, psychosocial, and environmental care for eligible members.

Positive

• Won major contract renewal for Illinois D-SNP program through 2029
• Potential for contract extension up to 10 years total
• Large member base expansion: 77,000 initial members plus 60,000 MLTSS members by 2027
• Geographic expansion to statewide coverage
• Similar contract wins in Michigan and Ohio through other subsidiaries

Negative

• None.

Insights

Healthcare Policy Analyst

Centene's subsidiary Meridian Health Plan of Illinois has secured a significant long-term government contract to provide integrated care for dual-eligible Medicare and Medicaid beneficiaries across Illinois. This represents a substantial business commitment with the contract running from January 2026 through December 2029, with potential extensions creating up to a 10-year revenue stream.

The scope is considerable - Meridian will initially serve 77,000 dual-eligible members statewide, expanding to include an additional 60,000 MLTSS members in 2027. This builds on Meridian's current service to approximately 24,000 dual-eligible members in Illinois, where they've operated since 2008.

This contract award strengthens Centene's market position in the specialized dual-eligible segment - a complex population requiring sophisticated care coordination across medical, behavioral, and social determinants of health. The integrated D-SNP model aligns with increasing state preferences for unified care management approaches that improve outcomes while controlling costs.

The mention of similar contract wins for Centene subsidiaries in Michigan and Ohio indicates a broader strategic success across multiple states. This multi-state pattern suggests Centene is successfully positioning itself as a leader in this specialized market segment, building on its core competency in government-sponsored healthcare programs.

For investors, this represents meaningful positive news as it secures predictable, long-term government revenue streams, demonstrates contract retention capabilities, and signals continued execution of Centene's strategic focus on serving complex populations.

Financial Analyst

This Illinois D-SNP contract represents a significant revenue opportunity for Centene through its Meridian subsidiary. While the exact contract value isn't disclosed, the dual-eligible population typically generates higher per-member-per-month rates than standard Medicaid due to their complex healthcare needs.

The contract architecture is particularly valuable from a financial stability perspective. The four-year initial term with renewal options up to 10 years provides exceptional revenue visibility in an industry where contract durations are typically shorter. This long-term structure allows for more efficient capital allocation and operational planning.

The membership dynamics show meaningful expansion potential. Meridian currently serves about 24,000 dual-eligible members in Illinois but will provide care for 77,000 members starting in 2026, with an additional 60,000 MLTSS members in 2027. This represents potential membership growth of over 400% from current levels.

The concurrent contract wins in Michigan and Ohio indicate a broader pattern of success in capturing this specialty market segment across multiple states. This multi-state approach creates operational synergies through shared administrative functions, care management protocols, and technology infrastructure.

From a competitive standpoint, being selected as one of only four health plans for this Illinois program demonstrates Centene's strong positioning in this specialized market. The dual-eligible segment requires sophisticated capabilities in coordinating benefits across Medicare and Medicaid systems - creating natural barriers to entry and potentially higher margins than standard Medicaid business.

ST. LOUIS, March 17, 2025 /PRNewswire/ -- Centene Corporation (NYSE: CNC), a leading healthcare enterprise committed to helping people live healthier lives, announced today that its subsidiary, Meridian Health Plan of Illinois, Inc. (Meridian), has been selected by the Illinois Department of Healthcare and Family Services (HFS) to continue providing Medicare and Medicaid services for dually eligible Illinoisans through a Fully Integrated Dual Eligible Special Needs Plan (D-SNP). The D-SNP program will provide services and support statewide for dually eligible members who qualify for Medicare and Medicaid, as well as dually eligible Managed Long Term Services and Supports (MLTSS) members, under a single managed care organization. The new D-SNP contract is expected to begin on Jan. 1, 2026, and operate through Dec. 31, 2029, with the state having the option to renew for intervals of six months to five and a half years for a total contract term of up to 10 years.

"We look forward to working with HFS to address the unique needs of Illinoisans who are dually eligible for Medicare and Medicaid," said Centene Chief Executive Officer (CEO) Sarah M. London. "This award is a testament to our experience and ongoing commitment to fully integrate care for people with complex healthcare needs and to build stronger connections between medical, behavioral, psychosocial and environmental care for this community."

Meridian has been serving members in Illinois since 2008 and is among four health plans selected by HFS to deliver access to high-quality managed care services to 77,000 Medicare-Medicaid-eligible Illinoisans through the state's new D-SNP product across the state. Beginning in 2027, 60,000 dually eligible MLTSS individuals will be included in the D-SNP plan. As of February 2025, Meridian serves more than 13,000 Medicaid-Medicare members and more than 11,000 dually eligible MLTSS members through the Illinois HealthChoice Medicaid program. Under the D-SNP contract, Meridian will manage coverage for services to address members' needs on a holistic level to eradicate barriers to healthcare, improve behavioral health and reduce disparities in health outcomes.

"We are proud to continue to connect our dually eligible members to a comprehensive range of services to support their physical, mental and emotional well-being," said Meridian CEO and Plan President Cristal Gary. "Our focus on local, culturally sensitive care helps members get the services and support they need, where they are. Meridian is committed to continuously innovating programs and processes to ensure our members achieve the best health outcomes possible."

Additional Centene Corporation companies Meridian Health Plan of Michigan, Inc. and Buckeye Health Plan in Ohio were recently selected to provide integrated services for dually eligible individuals in their respective states.

About Centene Corporation 
Centene Corporation, a Fortune 500 company, is a leading 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 more than 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. 

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://investors.centene.com/.  

About Meridian Health Plan of Illinois
Meridian Health Plan of Illinois, Inc. and its family of health plans provide government-sponsored managed care services to families, children, seniors, and individuals with complex medical needs. This includes Meridian's Medicaid and Medicare-Medicaid plans, and YouthCare HealthChoice Illinois. YouthCare is a specialized program designed to address the healthcare needs of Illinois Department of Children and Family Services (DCFS) youth in out-of-home placement and former foster youth. Meridian connects members to care and offers comprehensive services to support lifelong health and wellness. Meridian is a Centene Corporation company. Learn more at ILmeridian.com.   

Forward-Looking Statements
All statements, other than statements of current or historical fact, contained in this press release are forward-looking statements. Without limiting the foregoing, forward-looking statements often use words such as "believe," "anticipate," "plan," "expect," "estimate," "intend," "seek," "target," "goal," "may," "will," "would," "could," "should," "can," "continue" and other similar words or expressions (and the negative thereof). Centene Corporation and its subsidiaries (Centene, the Company, our or we) intends such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for purposes of complying with these safe-harbor provisions. In particular, these statements include, without limitation, statements about our expected contract start dates and terms, our future operating or financial performance, changes in laws and regulations (including but not limited to, renewal and modification of the enhanced advance premium tax credits associated with the Marketplace product), market opportunity, competition, expected activities in connection with completed and future acquisitions and dispositions, our 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: our ability to design and price products that are competitive and/or actuarially sound including but not limited to any impacts resulting from Medicaid redeterminations; 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 could impact revenue and future growth; our ability to accurately predict and effectively manage health benefits and other operating expenses and reserves, including fluctuations in medical utilization rates; competition, including for providers, broker distribution networks, contract reprocurements and organic growth; our ability to adequately anticipate demand and timely provide for operational resources to maintain service level requirements in compliance with the terms of our contracts and state and federal regulations; our ability to manage our information systems effectively; disruption, unexpected costs, or similar risks from business transactions, including acquisitions, divestitures, and changes in our relationships with third-party vendors; disruption, unexpected costs, or similar risks from business transactions, including acquisitions, divestitures, and changes in our relationships with third-party vendors; impairments to real estate, investments, goodwill, and intangible assets; changes in senior management, loss of one or more key personnel or an inability to attract, hire, integrate and retain skilled personnel; membership and revenue declines or unexpected trends; rate cuts, insufficient rate changes or other payment reductions or delays by governmental payors and other risks and uncertainties affecting our government businesses; changes in healthcare practices, new technologies, and advances in medicine; our ability to effectively and ethically use artificial intelligence and machine learning in compliance with applicable laws; increased healthcare costs; inflation and interest rates; the effect of social, economic, and political conditions and geopolitical events, including as a result of changes in U.S. presidential administrations or Congress; changes in 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 ACA) and any regulations enacted thereunder, including the timing and terms of renewal or modification of the enhanced advance premium tax credits or program integrity initiatives that could have the effect of reducing membership or profitability of our products; uncertainty concerning government shutdowns, debt ceilings or funding; tax matters; disasters, climate-related incidents, acts of war or aggression or major epidemics; changes in expected contract start dates and terms; changes in provider, broker, vendor, state, federal, and other contracts and delays in the timing of regulatory approval of contracts, including due to protests and our ability to timely comply with any such changes to our contractual requirements or manage any unexpected delays in regulatory approval of contracts; the expiration, suspension, or termination of our contracts with federal or state governments (including, but not limited to, Medicaid, Medicare or other customers); the difficulty of predicting the timing or outcome of legal or regulatory audits, investigations, proceedings or matters, including, but not limited to, our ability to resolve claims and/or allegations made by states with regard to past practices on acceptable terms, or at all, or whether additional claims, reviews or investigations will be brought by states, the federal government or shareholder litigants, or government investigations; challenges to our contract awards; cyber-attacks or other data security incidents or our failure to comply with applicable privacy, data or security laws and regulations; the exertion of management's time and our resources, and other expenses incurred and business changes required in connection with complying with the terms of our contracts and the undertakings in connection with any regulatory, governmental, or third party consents or approvals for acquisitions or dispositions; any changes in expected closing dates, estimated purchase price, or accretion for acquisitions or dispositions; losses in our investment portfolio; restrictions and limitations in connection with our indebtedness; a downgrade of our corporate family rating, issuer rating or credit rating of our indebtedness; the availability of debt and equity financing on terms that are favorable to us and risks and uncertainties discussed in the reports that Centene has filed with the Securities and Exchange Commission (SEC). 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 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

When does Meridian's new D-SNP contract with Illinois start and how long will it last?

The contract begins January 1, 2026, running through December 31, 2029, with potential renewals for up to 10 years total.

How many members will Meridian serve under the new Illinois D-SNP program?

Meridian will serve 77,000 Medicare-Medicaid-eligible members initially, with 60,000 additional MLTSS members joining in 2027.

What is Meridian's current membership base in Illinois for dual-eligible programs?

Meridian currently serves over 13,000 Medicaid-Medicare members and 11,000 dually eligible MLTSS members through Illinois HealthChoice.

What services will CNC's Meridian provide under the new D-SNP contract?

Meridian will provide integrated medical, behavioral, psychosocial, and environmental care services for dually eligible Medicare and Medicaid members statewide.