Centene Sells Majority Stake In U.S. Medical Management
ST. LOUIS, Nov. 3, 2021 /PRNewswire/ -- Centene Corporation (NYSE: CNC) announced today that it has signed a definitive agreement to sell a majority stake in U.S. Medical Management, LLC (USMM) to Rubicon Founders; Valtruis, a WCAS company; Oak HC/FT; and HLM Venture Partners. Centene will retain a minority stake in USMM.
"With more than 25 years of experience in home-based care, USMM has outperformed in numerous value-based care initiatives and consistently delivered lower costs, better health outcomes, and higher patient satisfaction ratings," said Sarah London, Vice Chairman of Centene's Board of Directors. "We are confident this transaction will best position USMM to expand its reach and impact while helping Centene to deliver on our value creation plan. As part of our ongoing portfolio review, Centene intends to use the proceeds from the sale to repurchase stock, in a first step towards a material stock repurchase program."
USMM is a family of companies dedicated to providing high-quality, coordinated healthcare in the home. USMM has also developed and owns several allied health assets, which assist in the provision of home-based primary care and furthers the value and efficiency of house call medicine. USMM Accountable Care Partners (USMM ACP) launched as an Accountable Care Organization in 2015, and today, is the only ACO focused solely on the frail, disabled or home-limited populations. Over the past five years, USMM ACP has demonstrated savings for its Medicare beneficiaries of $154 million.
"This is a unique opportunity to partner with one of the most important value-based healthcare companies in the country. Patients depend on USMM every day for medical care where it is needed most—in the convenience of their homes. I strongly believe in this mission and look forward to working closely with the team to make a significant difference in peoples' lives," said Adam Boehler, CEO of Rubicon Founders, former Director of CMMI, and former CEO and founder of Landmark Health.
Evercore is serving as financial advisor to Centene, and Skadden, Arps, Slate, Meagher & Flom LLP and Locke Lord LLP are serving as its legal counsel. Ropes & Gray LLP is serving as legal counsel to WCAS.
The transaction is subject to clearance under the Hart-Scott Rodino Act and satisfaction of other customary closing conditions.
About Centene Corporation
Centene Corporation, a Fortune 25 company, is a leading multi-national healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach – with local brands and local teams – to provide fully integrated, high-quality, and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured and uninsured individuals. Centene offers affordable and high-quality products to nearly 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace, the TRICARE program, and individuals in correctional facilities. The Company also serves several international markets, and contracts with other healthcare and commercial organizations to provide a variety of specialty services focused on treating the whole person. Centene focuses on long-term growth and the development of its people, systems and capabilities so that it can better serve its members, providers, local communities, and government partners.
Centene uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, https://investors.centene.com/.
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(Envolve), as our pharmacy benefits manager (PBM) subsidiary, within the reserve estimate we have recorded and on other acceptable terms, or at all, or whether additional claims, reviews or investigations relating to our PBM business will be brought by states, the federal government or shareholder litigants, or government investigations; timing and extent of benefits from strategic value creation initiatives; challenges to our contract awards; cyber-attacks or other privacy or data security incidents; the exertion of management's time and our resources, and other expenses incurred and business changes required in connection with complying with the undertakings in connection with any regulatory, governmental or third party consents or approvals for acquisitions, including the Magellan Acquisition; changes in expected closing dates, estimated purchase price and accretion for acquisitions; the risk that acquired businesses will not be integrated successfully; restrictions and limitations in connection with our indebtedness; our ability to maintain or achieve improvement in the Centers for Medicare and Medicaid Services (CMS) Star ratings and maintain or achieve improvement in other quality scores in each case that can impact revenue and future growth; availability of debt and equity financing, on terms that are favorable to us; inflation; foreign currency fluctuations and risks and uncertainties discussed in the reports that Centene has filed with the Securities and Exchange Commission. This list of important factors is not intended to be exhaustive. We discuss certain of these matters more fully, as well as certain other factors that may affect our business operations, financial condition and results of operations, in our filings with the Securities and Exchange Commission (SEC), including our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. Due to these important factors and risks, we cannot give assurances with respect to our future performance, including without limitation our ability to maintain adequate premium levels or our ability to control our future medical and selling, general and administrative costs.
SOURCE Centene Corporation
Released November 3, 2021