Centene Corporation (NYSE: CNC) is on the move. Just days after announcing its 89% stake in a Madrid hospital, the insurer came back with a deal to buy QualChoice Health Insurance from Catholic Health Initiatives (CHI), one of the largest not-for-profit hospital systems in the United States.
The deal isn’t officially announced but has been acknowledged by both companies. It was reported in the Arkansas Democrat-Gazette and other local newspapers on January 4 based on interviews with QualChoice CEO Randall Crow and a Centene spokesman. Both said the companies have entered into a definitive agreement on the sale and are waiting for approval from Arkansas Insurance Commissioner Allen Kerr to approve the transaction.
QualChoice Holdings, Inc., through its subsidiaries QCA Health Plan, Inc. and QualChoice Life and Health Insurance, Inc., is the second largest managed care company in Arkansas. CHI announced its acquisition of QualChoice Holdings in April 2014, through its own subsidiary, Collab Health.
But after some rough quarters, CHI had enough. The managed care company had lost $97 million in the nine months ending March 31, 2016, and in June CHI put QualChoice on the block.
Centene has stayed quiet on the M&A front as it digested its $3.75 billion purchase of Fidelis Care, a not-f0r-profit health insurer operating in New York state. That deal, announced in September 2017, closed on July 30, 2018.
In December 2018, Centene bought an 89% stake in Torrejon Salud, owner of the University Hospital of Torrejon de Ardoz, a 250-bed hospital in Madrid. The facility serves approximately 150,000 people with a broad portfolio of services and clinics. Centene’s partner in Spain, Ribera Salud Group, will take over management of the center. Centene owns 50% of Ribera Salud, which ran the center from its opening in 2011 until November 2012.