Aetna buys Medicare supplement unit to attract seniors

Sensing opportunity with aging Baby Boomers, Aetna (NYSE: AET) purchased a Medicare supplement business from Genworth Financial for $290 million, the the health insurance giant recently announced.

Aetna will add 145,000 members to its rolls with the acquisition of Continental Life Insurance Co. of Brentwood, Tenn.

"Medicare Supplement is expected to be a fast-growing product in the coming years as individuals seek peace of mind for out-of-pocket costs and employers look for added retiree coverages," Aetna CEO and President Mark T. Bertolini said in a statement.

Medicare supplement--or Medigap--insurance covers deductibles, co-pays and other expenses not covered under Medicare Parts A and B. Continental Life also offers ancillary products like accident and health and final expense coverages.

Aetna said the deal is expected to close in the fourth quarter and will be neutral to 2012 earnings and "modestly accretive thereafter."

This deal is part of a larger trend in which health insurers are trying to expand their offerings to seniors. Just last week, WellPoint (NYSE: WLP) announced it is buying Medicare specialist CareMore Health Group for $800 million to better compete in the senior healthcare market.

For more:
- here's the Aetna announcement

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