EmblemHealth: EmblemHealth will sell Connecticut health plan for $350M

Insurance company EmblemHealth has agreed to sell its Connecticut health plan to focus on growing its business in New York City, the company said Tuesday.EmblemHealth, headquartered in the Financial District, agreed to sell its health plan ConnectiCare to the California-based managed care giant Molina Healthcare. Molina will purchase the business for $350 million, representing a quarter of ConnectiCare's expected premium revenue this year. The deal is part of an effort by EmblemHealth to concentrate growth in New York City, CEO Karen Ignagni told Crain's. The insurer is planning to invest in in-person neighborhood care centers, and improve private and government-funded insurance offerings for city residents, she said. "This provides us the capital to focus on our roots," Ignagni said.In the past year the company has developed a network of 15 neighborhood care centers citywide, which offer wellness classes and connect people with medical care. The aim is for the centers to address health inequities by helping people manage insurance claims, doctors appointments and prescription medications, Ignagni said.EmblemHealth provides coverage to three million people who live in the tri-state region. ConnectiCare has roughly 140,000 enrollees across its health insurance marketplace, Medicare and Medicaid plans, which Molina will acquire.ConnectiCare will preserve its brand after the acquisition, and patients will have access to the same coverage and physicians, according to EmblemHealth. Emblem selected Molina to acquire its Connecticut health plan because of its mission to provide health coverage through the insurance marketplace, as required by the Affordable Care Act. ConnectiCare is the largest marketplace provider in Connecticut, according to Ignagni.Molina's acquisition of ConnectiCare brings a new state into the company's portfolio, said Joe Zubretsky, the company's president and CEO. It also marks its second recent acquisition - the company bought Bright Group Health's Medicare Advantage plans for $425 million in December, according to a report in Modern Healthcare. Molina is one of the top managed care companies in the U.S., serving nearly 6 million members and reporting $34 billion in revenue last year.EmblemHealth expects to close the transaction in the first half of next year. In addition to its insurance plans and in-person centers, the company has an in-house physician network AdvantageCare Physicians and a digital wellness platform WellSpark.