Molina Healthcare, Inc. (NYSE: MOH) and HAP Midwest Health Plan, Inc.
(HAP Midwest) jointly announced today that Molina Healthcare of
Michigan, Inc., a wholly owned subsidiary of Molina Healthcare, Inc.,
has entered into a definitive agreement to acquire certain assets of the
Medicaid and MIChild businesses of HAP Midwest. As a part of the
transaction, Molina Healthcare of Michigan will receive the right to
assume certain assets related to HAP Midwest’s Medicaid and MIChild
businesses in Regions 9 and 10 of the State of Michigan and transition
those members to Molina Healthcare of Michigan. HAP Midwest currently
arranges health care services for approximately 85,000 Medicaid and
MIChild members in these two regions, which are composed of Livingston,
Macomb, Oakland, Washtenaw and Wayne counties. Molina Healthcare will
fund the transaction with available cash on hand. Subject to regulatory
approvals and the satisfaction of other conditions, the closing of the
transaction is expected to coincide with the start of Molina’s new
managed care contract with the State of Michigan for the Comprehensive
Health Care Program on January 1, 2016.
“Although we are disappointed by the state’s decision to reduce the
number of Medicaid plans in Regions 9 and 10, we are grateful for the
opportunity to transition our members to Molina, a quality plan with a
similar commitment to the Detroit market and a good working relationship
with Henry Ford Health System,” said Mary Ann Tournoux, Interim
President and CEO, HAP Midwest Health Plan. “HAP Midwest will continue
to provide services to Medicaid members in Region 6, as well as those
enrolled in the dual-eligible demonstration product (MI Health Link) in
Wayne and Macomb counties.”
“We are pleased to welcome HAP Midwest’s Medicaid and MIChild members in
Regions 9 and 10 to the Molina family,” said Stephen Harris, president
of Molina Healthcare of Michigan. “This agreement with HAP Midwest will
provide our new members with a seamless transition as the state begins a
new managed care contract on January 1, 2016. It also demonstrates our
commitment to Medicaid and the local provider community as we deepen our
relationship with the Henry Ford Health System relative to serving
Medicaid members. We look forward to working with HAP Midwest and the
Department of Health and Human Services as we continue our mission of
providing quality health care to people receiving government assistance.”
About Molina Healthcare of Michigan, Inc.
Molina Healthcare of Michigan currently operates Medicaid and Medicare
health plans with total membership of approximately 340,000 as of
September 2015. Additionally, Molina Healthcare of Michigan is a
certified Qualified Health Plan issuer on the Michigan Health Insurance
Exchange in the non-group health insurance market in Wayne, Oakland and
Macomb counties.
About Molina Healthcare, Inc.
Molina Healthcare, Inc., a FORTUNE 500 company, provides managed health
care services under the Medicaid and Medicare programs and through the
state insurance marketplaces. Through our locally operated health plans
in 11 states across the nation and in the Commonwealth of Puerto Rico,
Molina serves approximately 3.5 million members. Dr. C. David Molina
founded our company in 1980 as a provider organization serving
low-income families in Southern California. Today, we continue his
mission of providing high quality and cost-effective health care to
those who need it most. For more information about Molina Healthcare,
please visit our website at molinahealthcare.com.
About HAP Midwest Health Plan
HAP Midwest Health Plan, Inc. is a wholly owned subsidiary of Health
Alliance Plan (HAP) and the Henry Ford Health System based in
southeastern Michigan. The company became licensed in 1998 and was
accredited by the National Committee for Quality Assurance in 2000.
About HAP
HAP is a Michigan-based health and wellness company that provides
coverage to more than 680,000 members in six distinct product lines:
Group, individual, Medicare, Medicaid, self-funded and network leasing.
For over 50 years, HAP has partnered with leading doctors, hospitals,
employers and community organizations to enhance the health and
well-being of the lives we touch. To learn more, go to choosehap.org.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995: This press release contains “forward-looking
statements” regarding the proposed transaction between HAP Midwest
Health Plan, Inc. and Molina Healthcare of Michigan, Inc. All
forward-looking statements are based on current expectations that are
subject to numerous risk factors that could cause actual results to
differ materially. Such risk factors include, without limitation, risks
related to: the satisfaction or waiver of closing conditions for the
transaction, including the receipt of regulatory approvals; successfully
transitioning and integrating HAP Midwest Health Plan’s members into
Molina Healthcare of Michigan; a reversal of the decision by the State
of Michigan not to award a new contract for the Comprehensive Health
Care Program to HAP Midwest Health Plan for Regions 9 and 10; attrition
in membership pending the completion of and following the transition;
maintaining provider relations; accurately estimating medical costs with
respect to this population; and the possibility that the transaction
will not be completed on a timely basis or at all. Additional
information regarding the risk factors to which Molina Healthcare is
subject is provided in greater detail in its periodic reports and
filings with the Securities and Exchange Commission, including its most
recent Annual Report on Form 10-K. These reports can be accessed under
the investor relations tab of Molina Healthcare’s website or on the
SEC’s website at sec.gov.
Given these risks and uncertainties, Molina Healthcare can give no
assurances that its forward-looking statements will prove to be
accurate, or that any other results or events projected or contemplated
by its forward-looking statements will in fact occur, and Molina
Healthcare cautions investors not to place undue reliance on these
statements. All forward-looking statements in this release represent
Molina Healthcare’s judgment as of the date hereof, and Molina
Healthcare disclaims any obligation to update any forward-looking
statements to conform the statement to actual results or changes in its
expectations that occur after the date of this release.
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