Molina Healthcare has agreed to buy Universal American's Total Care Medicaid plan in upstate New York for $41.3 million, the companies announced Tuesday.
The Total Care unit of Universal American is a prepaid health-services plan that provides coverage to about 39,000 members under the Medicaid and Child Health Plus programs in three upstate New York counties: Cortland, Onondaga and Tompkins.
Long Beach, Calif.-based Molina Healthcare is buying the entire equity interest in Today's Options of New York, which operates the Total Care Medicaid plan, the companies said. Molina will finance the deal with available cash.
"This transaction expands our footprint into the top five largest Medicaid markets across the county and serves to further our strategy of continued geographic diversification,” Molina CEO Dr. J. Mario Molina said in a news release.
The companies expect to complete the deal in the third quarter pending regulatory approvals.
With the divestiture of Total Care, Universal American can concentrate on its Medicare Advantage and Medicare accountable care organization business, Richard Barasch, CEO of Universal American, said in the release.
Molina has about 3.9 million managed-care members across 11 states and Puerto Rico. The company specializes in coverage under the Medicaid and Medicare programs and through the state insurance marketplaces.