LUTHERAN ENTERS AGREEMENT TO SELL HEALTH PLUS ASSETS TO AMERIGROUP CORPORATION
Tuesday, October 25, 2011
FOR IMMEDIATE RELEASE
LUTHERAN ENTERS AGREEMENT TO SELL HEALTH PLUS ASSETS TO AMERIGROUP CORPORATION
October 25, 2011, Brooklyn, NY…Lutheran Medical Center, Health Plus and Amerigroup Corporation (NYSE: AGP) have signed an agreement today that will pave the way for Amerigroup to purchase substantially all of the operating assets and contract rights of Health Plus, one of the largest Medicaid managed care companies in New York. Health Plus, established in 1984 by Lutheran Medical Center, currently serves approximately 320,000 members in New York State's Medicaid, Family Health Plus and Child Health Plus programs, as well as the federal Medicare program.
As hospitals in Brooklyn continue to face mounting budget pressures, a benefit of the transaction includes a critical cash boost to Lutheran Medical Center, which will help stabilize a key part of Brooklyn's health care structure.
"For a community safety net hospital like Lutheran, the acquisition is particularly critical since it will mean an infusion of dollars that will establish an endowment – something that Lutheran has never had before. It will strengthen our financial viability allowing us to reinvest in patient care for our traditional Medicaid and uninsured populations," said Wendy Z. Goldstein, chief executive officer for Lutheran HealthCare. "This is a win-win-win for Lutheran, Health Plus and Amerigroup. The acquisition combines the strengths, resources and experience of two dynamic plans committed to serving low-income families and the uninsured into one superior health plan."
Lutheran, Health Plus and Amerigroup are deeply committed to the overall health and well-being of New York's culturally diverse communities. The state of New York recently committed to providing care to more residents with disabilities and mandating managed long term care by April 2012. Amerigroup will bring its expertise in managing the complex care needs of patients with disabilities and seniors to its new members.
"This acquisition will provide greater access to quality care for Amerigroup and Health Plus members, cost savings for the State and New York City, as well as provide a renewed investment in the local community," said James G. Carlson, chairman and chief executive officer for Amerigroup. "Our national expertise in coordinating care for low-income populations and people with disabilities, coupled with the excellence of Health Plus, will allow us to better serve current and new members, collaborate with providers and expand our patient-centered medical home model."
The purchase price is $85 million and the transaction, which is subject to regulatory approvals and other closing conditions, is expected to close in the first half of 2012.
About Health Plus: Health Plus, a not-for-profit, multi-cultural organization, is one of the largest managed care organizations in New York City. It was established in 1984 with a commitment to provide coordinated quality healthcare and improving access to healthcare for uninsured and underserved families. Click here for more information on Health Plus: http://www.healthplus-ny.org.
About Amerigroup Corporation: Amerigroup, a Fortune 500 Company, coordinates services for individuals in publicly funded healthcare programs. Serving approximately 2 million members in 11 states nationwide, Amerigroup accepts all eligible people regardless of age, sex, race or disability. The Company's product offerings do not utilize any individual underwriting nor deny coverage due to preexisting medical conditions. Amerigroup is dedicated to offering real solutions that improve healthcare access and quality for its members, while proactively working to reduce the overall cost of care to taxpayers. Click here for more information about Amerigroup Corporation: http://www.amerigroupcorp.com.
About Lutheran HealthCare: As Brooklyn's premier health care network, Lutheran HealthCare (LHC) is a comprehensive medical safety net and social support system committed to providing services for the whole person -- physically, emotionally and spiritually. The LHC system of community health providers includes Lutheran Medical Center, the Lutheran Family Health Centers, Lutheran Augustana Center for Extended Care and Rehabilitation, Community Care Organization, Inc, Health Plus, senior housing programs and more. Learn about LHC and its 127-year-old commitment to serving Brooklyn neighborhoods by visiting www.LutheranHealthCare.org.
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