Molina Healthcare (MOH) said on Tuesday that it entered a definitive agreement to buy Affinity Health Plan assets for $380 million cash, expanding Molina's Medicaid health benefits in New York.
“The acquisition of Affinity provides us with a stable base of membership and revenue and will deepen Molina’s service offerings in New York, allowing us to meet the needs of hundreds of thousands of additional Medicaid members,” Molina Chief Executive Joe Zubretsky said in a statement.
“The transaction provides added stability to Affinity’s Medicaid members and its state partner during this critical time.”
The deal should immediately add to Molina's adjusted earnings per share, the Long Beach, Calif., company said.
Molina and Affinity expect to close the deal in the second quarter of 2021, subject to conditions including regulatory clearances.
Based in New York, Affinity is a Medicaid managed-care organization serving New York City and five nearby counties, Westchester, Orange, Nassau, Suffolk, and Rockland.
In August, the company provided services to 284,000 Medicaid members. It posted premium revenue of around $1.3 billion for the 12 months ending on July 31.
Under the Medicaid and Medicare programs, Molina Healthcare provides managed healthcare services through state insurance marketplaces. As of June 30, the healthcare service provider served around 3.6 million members.
Earlier this month, Molina Healthcare announced the closing of its acquisition of certain assets related to the Medicaid line of business of Passport Health Plan.
Additionally, Molina Healthcare of Kentucky began to provide Medicaid managed care benefits to Medicaid members who had been served by Passport.
On Monday, Molina Healthcare said it will report for the third quarter on Oct. 28.
At last check, Molina shares were trading up 3.8% at $169.27.