Industry perspective.WellPoint's acquisition strategy, as well as its strong financial performance in the past year, appear to point the company in a much different direction, than that of one of its biggest rivals--Aetna Inc. WellPoint has 10 million members. CareFirst has 1.3 million members in Maryland, Delaware, the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). and northern Virginia Northern Virginia (NoVA) consists of Arlington, Fairfax, Loudoun, and Prince William counties and the independent cities of Alexandria, Falls Church, Fairfax, Manassas, and Manassas Park. . RightChoice operates in Missouri as Blue Gross & Blue Shield Blue Shield A US not-for-profit health care insurer that is a reimbursement intermediary for physicians. Cf Blue Cross. of Missouri, with a total membership of 2.8 million. Aetna has 17.5 million healthcare members, 13.7 million dental members and 11.7 million group insurance members as of Sept. 30, 2001, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Aetna's Web site. But Aetna's membership has been eroding. Aetna's total health membership for the third quarter fell by about 566,000 from the second quarter, and 1.8 million from year-end 2000, due to reductions in commercial HMO HMO health maintenance organization. HMO n. A corporation that is financed by insurance premiums and has member physicians and professional staff who provide curative and preventive medicine within certain financial, membership, and targeted Medicare and Medicaid Medicare and Medicaid U.S. government programs in effect since 1966. Medicare covers most people 65 or older and those with long-term disabilities. Part A, a hospital insurance plan, also pays for home health visits and hospice care. market withdrawals. RELATED ARTICLE: What's Next CareFirst will have to win regulatory approval from Delaware, Maryland and the District of Columbia to convert to for-profit status before the merger can take place. Both companies said in a Nov. 21 conference call that the entire $1.3 billion will fund charitable activities "as determined by local officials." In addition, Congress will have to either amend or repeal the federal charter of CareFirst's Washington, D.C., operating affiliate--Group Hospitalization hospitalization /hos·pi·tal·iza·tion/ (hos?pi-t'l-i-za´shun) 1. the placing of a patient in a hospital for treatment. 2. the term of confinement in a hospital. & Medical Services Inc., and the district's corporation counsel will have to approve the plan. Once CareFirst's conversion is completed, WellPoint will pay $450 million in cash and $850 million in stock for the company. WellPoint will have the option of increasing the cash component, with a corresponding decrease in the stock component of the deal. "All of the proceeds will be used to fulfill the public benefit requirements of CareFirst," the two companies said in a statement. Maryland's top insurance regulator will seek outside help to evaluate WellPoint's proposed acquisition of CareFirst. The commissioner may team up with the District of Columbia's insurance commissioner to examine the merger plan. Steven B. Larsen, commissioner for the Maryland Insurance Administration, said in a conference call that outside experts will assist his department in the evaluation of the proposal. "We're going to hire experts to look at four different areas," he said. |
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