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 Mercy news release sent Wednesday.
Financial terms were not disclosed.
MHP offers insurance in Springfield in partnership with St. John's Health System.
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,” said Lynn Britton, Mercy president and CEO. “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.”
Coventry CEO Allen Wise 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.
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.
Barb Meyer, Mercy vice president of marketing and communication, said no decisions have been made as to whether any MHP employees will be laid off.
In April 2009, MHP moved its Springfield headquarters to a new building on South National Avenue allowing for 146 employees, according to an SBJ report.
When the acquisition is made, Coventry will provide services to more than 1.2 million members in the Midwest, the release said.[[In-content Ad]]