Bethesda, Md.-based Coventry Health Care Inc. has signed an agreement with the Sisters of Mercy Health System to acquire Mercy Health Plans within 90 to 120 days, according to a June 30 Mercy news release.
Financial terms of the transaction were not disclosed.
MHP offers insurance in Springfield in partnership with St. John’s Health System and runs its claims and customer service operations from 4520 S. National Ave.
Mutual benefits Leaders of both companies spoke about the possibilities of the acquisition in the news release.
“After giving thoughtful consideration to our future strategies as a health care organization, Mercy’s board and leadership have determined that our core mission is best served by focusing on providing health care services to our communities,” Mercy President and CEO Lynn Britton said in the release. “Likewise, MHP’s progress as a health insurance company will be strengthened by being aligned with an organization focused solely on serving the needs of health plan members.”
Allen Wise, CEO of publicly traded Coventry (NYSE: CVH), which reported $13.9 billion in 2009 revenue, said the acquisition would be a natural transition.
“Mercy Health Plans’ businesses are ones that we understand well, and we are confident that they will increase shareholder value over the long term,” he said in the release.
Employee outlook MHP is a health insurance subsidiary based in Chesterfield with about 180,000 members in Missouri and Arkansas. It was established by Mercy in 1994 and has operations in St. Louis and southwest Missouri.
The majority of MHP’s approximately 420 employees will start work for Coventry as a part of the transaction, according to the release.
MHP has approximately 140 employees in Springfield, and it is likely most of them will keep their jobs, said Mike Peters, St. John’s vice president of public affairs.
“Our understanding is that Coventry will keep the vast majority of individuals that are with MHP right now, but they’ll always evaluate that as they integrate MHP into their operation,” he said. “That’s not Mercy’s decision. That’s something Coventry would have to decide.”
In April 2009, MHP moved its Springfield headquarters to a new two-story building on South National Avenue.
When the acquisition is final, Coventry will provide services to more than 1.2 million members in the Midwest, the release said.[[In-content Ad]]
