Wellpoint Acquires MethodistCare

WellPoint Health Networks Inc., one of the nation’s largest publicly-traded health insurance companies, announced Jan. 25 that it has signed a definitive agreement to acquire MethodistCare, the managed care subsidiary of Methodist Health Care System. MethodistCare is one of Houston’s largest HMOs, serving almost 78,000 members. Terms of the transaction were not disclosed.

As part of the transaction, WellPoint’s UNICARE Life & Health Insurance Company national operating unit, which currently serves 322,240 medical members throughout Texas, signed a five-year agreement with Methodist Health Care System, to provide covered medical services to all members of UNICARE’s HMO and PPO networks.

"This transaction, which is consistent with our growth strategy, allows us to significantly enhance our product portfolio in the Houston area and build our UNICARE brand," said Leonard D. Schaeffer, WellPoint’s chairman and chief executive officer. "We also look forward to strengthening our relationship with Methodist Health Care System. Its flagship, The Methodist Hospital, is recognized as one of the leading hospitals in the United States and is one of the top centers in numerous clinical areas. This agreement will give UNICARE members increased access to affordable, high-quality care."

This acquisition will enable UNICARE to expand its product line for all market segments by offering HMO products along with other open access products. The combination of UNICARE’s business with MethodistCare’s comprehensive line of products for large and small businesses will allow UNICARE to enhance and strengthen its presence in the market.

"We are excited to join with WellPoint, which is well known for its customer focus and financial stability," said Albert R. Zimmerli, chief financial officer and executive vice president, Methodist Health Care System. "MethodistCare has a history of strong membership growth and consistently high member satisfaction. This agreement builds on that foundation."

The transaction is expected to close during the second quarter of this year.

WellPoint Health Networks Inc. serves the health care needs of approximately 10 million medical and more than 44 million specialty members through Blue Cross of California, Blue Cross Blue Shield of Georgia and UNICARE. The company offers a broad spectrum of network-based health products including open access PPO, POS and hybrid products, HMO and specialty products. Specialty products include pharmacy benefit management, dental, vision, behavioral health, life and disability insurance, long term care insurance, flexible spending accounts, COBRA administration, and Medicare supplements.

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