Aetna enters agreement to procure Prodigy Health Group

Aetna (NYSE: AET) today announced that it has entered into an agreement to acquire Prodigy Health Group, the nation's largest independent third party administrator (TPA) of self-funded health care plans. Headquartered in New York City, Prodigy Health Group has approximately 600,000 medical members, approximately 450,000 pharmacy members, and operates in 15 states.

Aetna will acquire Prodigy Health Group from Prodigy Health Holdings, LLC, whose majority owner is One Equity Partners. The purchase price is approximately $600 million. Aetna expects to finance the acquisition with available resources. The transaction is subject to customary closing conditions, including Hart-Scott-Rodino antitrust regulatory approval. The transaction is expected to close in the second half of 2011 and, as financed, is projected to be neutral to Aetna's financial results in 2011 and modestly accretive in 2012.

"The acquisition of Prodigy Health Group is in keeping with Aetna's strategy of diversifying its product offerings and adding new revenue streams," said Mark T. Bertolini, chairman, CEO and president. "Prodigy extends Aetna's reach into the third-party administrator business while providing a separate option under the Prodigy brands that addresses affordability and quality for middle-sized and small businesses and customers who are primarily price-focused."

Joseph M. Zubretsky, senior executive vice president and CFO, added, "We believe that there are a number of positive synergies to be gained from our acquisition of Prodigy Health Group, including leveraging our provider networks and PBM capabilities to grow membership and enhance our ability to develop customized networks in accountable care models. The acquisition leverages many of Aetna's existing capabilities and is projected to have attractive returns."

Prodigy Health Group operates under three business names: Meritain Health for its TPA benefits business; American Health for its medical management business; and Scrip World for its pharmacy benefits management business. Following the close of the transaction, Prodigy Health Group will be a subsidiary of Aetna and will operate as a separate business. Prodigy Health Group will maintain its current management and operating structure and compete under its own brands.

Source:

Comments

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of News Medical.
Post a new comment
Post

While we only use edited and approved content for Azthena answers, it may on occasions provide incorrect responses. Please confirm any data provided with the related suppliers or authors. We do not provide medical advice, if you search for medical information you must always consult a medical professional before acting on any information provided.

Your questions, but not your email details will be shared with OpenAI and retained for 30 days in accordance with their privacy principles.

Please do not ask questions that use sensitive or confidential information.

Read the full Terms & Conditions.

You might also like...
A reduction in BMI among adults is associated with lower health care spending, study suggests