The two insurers announced plans for a $17.3 billion megamerger in March 2019.
Centene Corp. and WellCare Health Plans announced Tuesday that the two companies have received final regulatory approval for a proposed $17.3 billion megamerger, which is set to close Thursday.
As part of the transaction closing, WellCare will divest its Medicaid and Medicare Advantage plans in Missouri, along with its Medicaid plan in Nebraska, while Centene divests its Medicaid and Medicare Advantage plans in Illinois.
The two insurers announced plans for a $17.3 billion megamerger in March 2019 and the combined company will oversee 22 million members in all 50 states.
Centene CEO Michael F. Neidorff is slated to lead the company, which will be based in St. Louis.
“We are pleased to achieve this milestone and look forward to closing our acquisition of WellCare and providing more members and communities access to high-quality healthcare," Neidorff said in a statement. "We also look forward to building on our relationships with providers and government partners through the combined company’s wide range of affordable health solutions. We have been working diligently on the integration plans to bring our organizations together so that it is seamless for members, providers and employees of both companies."
As part of the approval process, had to receive sign offs from shareholders, state regulators, and multiple federal agencies, including the Federal Trade Commission and the Department of Justice (DOJ).
In May 2019, the DOJ requested additional information related to the deal from both companies, effectively delaying finalization of the deal by 30 days.
Shortly thereafter, Centene fended off rumors that Humana Inc. was interested in purchasing the company.
Both companies produced strong financials during Q3, as Centene's total managed care membership hit 15.3 million, its diluted earnings per share (EPS) rose 360% year-over-year to $0.23, and its adjusted EPS increased 8% to $0.89.
Meanwhile, WellCare reported $241 million in net income and $7.1 billion in total revenues.
Jack O'Brien is the finance editor at HealthLeaders, a Simplify Compliance brand.
Photo credit: KIEV, UKRAINE - Dec 11, 2018: Centene Corporation Insurance company logo seen displayed on smart phone. - Image / Editorial credit: IgorGolovniov / Shutterstock.com