Coventry Health Care Acquires Mercy Health Plans – Part of the Catholic Healthcare System With Focus on Increasing Shareho
Posted Jul 01 2010 8:45am
Yes you read this correctly and I try to include those comments on the blog as they are published to bring an awareness around to what is happening here with the “business side” of healthcare as it is changing. We have one more example of “losing the religion” here with Mercy Health Plans affiliated with Catholic Healthcare selling off their administrative functions in administering their health insurance to a “for profit” company, Coventry. We seem to continue to see an exodus of Catholic healthcare in bits and pieces. Recently in the news a hospital chain in Massachusetts was purchased by a private equity firm that was coming out of bankruptcy.
As health systems continue to be strained for money who knows how many more like this we will see. When you read further here, there is a notation that Coventry is also one foot in the door with a provider solution for the entire Sisters of Mercy Health System too, but not many details were revealed. As the article states, the focus is “shareholder value” and maybe some decent care might come along with it? BD
As part of the deal, Bethesda, Md.-based Coventry also is entering a long-term provider and customer relationship with Sisters of Mercy Health System and its affiliates.
Coventry said the transaction is expected to close in the next 90 to 120 days, subject to customary closing conditions and regulatory and other approvals. Coventry said the acquisition is expected to be slightly accretive to its 2011 earnings.
Mercy Health Plans has nearly 420 total employees: about 270 in St. Louis, 140 in Springfield, and eight in Arkansas, according to Mercy spokeswoman Barb Meyer.
“This acquisition reaffirms Coventry’s commitment to broadening its health plan footprint and is consistent with our focus on our seven core businesses,” Wise said. “Mercy Health Plans’ businesses are ones that we understand well and we are confident that they will increase shareholder value over the long term.”
Sisters of Mercy Health System has self-funded plans for its employees, Meyer said. Mercy Health Plans serves as the third-party administrator of those plans for claims administration, and Coventry will assume that role once the sale is complete.