April 15 (Bloomberg) — For WellCare Health Plans Inc., Medicare and Medicaid are the ticket to a takeover.
WellCare gets almost all of its revenue from Medicare and Medicaid, which provide medical coverage to the elderly, disabled and poor. Both programs are seeing rising demand as the baby boomer population ages and state governments with tight budgets shift more patients to managed-care companies like WellCare. That makes the Tampa, Florida-based company an appealing target for larger providers such as Cigna Corp. who want to tap that growth potential, said Credit Suisse Group AG.
Revenue at WellCare is forecast to climb about 45 percent through 2015, almost twice the median of its peers, according to data compiled by Bloomberg. The $2.8 billion company has also been without a permanent chief executive officer since November, making it more vulnerable to a takeover, said Stifel Financial Corp., which estimated the provider could get as much as a 34 percent premium in a sale. Aetna Inc. and Humana Inc. could also be interested in WellCare, said Jefferies Group.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
- Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
- Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
