Centene, WellCare get OK from 5 states for $17B merger

Centene
Centene announced that another five states have greenlit the pending $17 billion merger with WellCare. (Centene)

Centene and WellCare announced that another five states have approved the pending merger of the two insurers, bringing the total number of states that have greenlit the deal to 24.

Centene said on Friday that the deal is expected to be completed by the first half of 2020. However, the potential $17 billion merger will still need approval from the remaining state regulators.

“We will continue to work with the remaining state insurance regulators to demonstrate how we will provide recipients with access to affordable, high-quality services and products as well as deliver fair compensation for providers and create savings for states,” Centene CEO Michael Neidorff said in a statement.

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RELATED: Centene-WellCare merger gets OK from regulators in 17 states

State insurance regulators in Arizona, Connecticut, Georgia, Ohio and Texas approved the deal, which if completed would create one of the largest government plan insurers for Medicare, Medicaid and the Affordable Care Act exchanges.

However, the Department of Justice still needs to approve the deal, which is already getting opposition from provider groups.

The American Hospital Association warned that DOJ needs to fully investigate the merger because of concerns that it will harm competition for Medicare Advantage plans.

RELATED: SEC filings offer look inside Centene-WellCare merger talks

If the merger goes through then the new company would be the fourth-largest payer in the private Medicare space that includes Medicare Advantage and Part D plans. Overall there would be 22 million members across all 50 states.

The AHA said that DOJ has already blocked other major healthcare mergers, such as the Humana and Aetna merger, over concerns about consolidation in the Medicare Advantage market.

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