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October 25, 2011 at 10:55 AM
Amerigroup Corp. is citing a major New York state effort to manage long-term care costs (LTC) as a reason for acquiring Health Plus.
Amerigroup, Virginia Beach, Va. (NYSE:AGP), is one of a number of large but relatively low-profile companies that has been building up large Medicaid plan operations in recent years.
Lutheran Medical Center, Brooklyn, N.Y., organized Health Plus, Brooklyn, in 1984. Health Plus now generates about $1 billion in annual revenue from managing care for about 320,000 enrollees in state Medicaid, Family Health Plus and Child Health Plus plans.
Amerigroup has agreed to pay $85 million in cash for Health Plus and close on the deal by mid-2012.
Lutheran Medical Center – a community safety net hospital – hopes to use the proceeds from the deal to set up an endowment.
