Humana to acquire Medicare Advantage HMO MD Care

By:

Chris Anderson

Humana Inc. announced today an agreement to acquire Southern California’s MD Care, a Medicare Advantage HMO with approximately 15,000 members.

When completed the deal will add to Humana’s existing book of MA business in California where it has more than 200,000 members. MD Care’s 2010 revenue was $155 million. Terms of the agreement were not disclosed

“As Humana continues growing its Medicare business in the western U.S., MD Care offers an opportunity to expand our Medicare footprint and the suite of products and services we offer in California,” said Thomas J. Liston, senior vice president of senior products for Humana in a press release announcing the deal.

Four-year-old MD Care currently offers Medicare beneficiaries a choice of Medicare Advantage plans that serve as an alternative to traditional fee-for-service Medicare. MD Care’s medical plans include two Medicare Advantage plans including a special needs plan, and Medicare Part D insurance for prescription drug coverage. MD Care’s market area includes all of Los Angeles County and Orange County; and select zip codes San Bernardino County and Riverside County.

According to company information, MD Care’s medical delivery model focuses on preventive care, health maintenance and access to health services, which are safe, evidence-based and quality driven.

The transaction is subject to both federal and state regulatory approvals and is expected to close in late 2011. Humana’s acquisition of MD Care is not expected to materially impact the company’s financial earnings this year.