Michigan insurance officials agreed to sell two financially beleaguered Detroit-based Medicaid HMOs to publicly traded insurers. The Wellness Plan, Michigan's largest Medicaid HMO with 103,000 members, would be sold to Amerigroup, Virginia Beach, Va., for $38 million. And 63,000-member OmniCare Health Plan would be sold to Coventry Health Care, Bethesda, Md., for $12.6 million. Both Wellness and OmniCare have been under state control in court-ordered rehabilitation since July 2003 and July 2002, respectively. A county circuit court judge must approve the sales. Amerigroup covers more than 857,000 Medicaid beneficiaries in six states. Coventry has bout 324,000 Medicaid members and about 2 million commercial members in the Midwest, Mid-Atlantic and Southeastern U.S. Wellness and OmniCare would be the second and third Medicaid plans in Michigan to be sold to publicly traded insurers in the past six weeks. AmeriChoice Corp. completed its $27 million purchase of 96,000-member Great Lakes Health Plan, Southfield, Mich., in March. -- by Laura B. Benko
Mich. finds buyers for troubled Medicaid HMOs
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