Prognosis Is Poor for More Managed-Care Buyouts

Anthem's(ATH Quote) plan to buy Trigon Healthcare (TGH Quote) for $4 billion is part of an ongoing trend among Blue Cross Blue Shield operators to expand and compete more effectively with bigger players. But analysts say industry dynamics make further consolidation across the managed care industry unlikely.

"This is really a special case," said Sheryl Skolnick, an analyst at Fulcrum Global Partners.

Anthem, which went public last fall, said Monday that it was acquiring Trigon to move into a "very important new Southeast region." Trigon's shareholders will receive $30 cash and 1.062 shares of Anthem in exchange for each Trigon common share. The deal is expected to close in three to six months, pending regulatory and shareholder approval.

Dwindling Pool

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