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MANAGED CARE
Anthem seeks to seize market by acquiring Trigon
Anthem's decision last week to pay nearly $4 billion for Virginia's largest health insurer has ignited a battle between the nation's two biggest Blues consolidators for dominance of the Southeast.
In its largest transaction to date, Indianapolis-based Anthem announced last week its intentions to buy Trigon Healthcare, which owns Virginia's Blue Cross and Blue Shield plan, for $3.78 billion in cash and stock. The deal, which requires approval from the Virginia Bureau of Insurance, is expected to close in three to six months.
The addition of 2.2 million-member Trigon would allow Anthem to usurp-at least temporarily-WellPoint Health Networks' title as the nation's largest operator of Blues plans. It also would extend Anthem's geographic reach into the Southeast, where WellPoint has already established a beachhead, and throws a possible wrench into its main rival's plans for further expansion in the region.
With Trigon, Anthem would cover 10.1 million Blues members in nine states: Colorado, Connecticut, Indiana, Kentucky, Maine, Nevada, New Hampshire, Ohio and Virginia. Thousand Oaks, Calif.-based WellPoint covers 9.9 million Blues members in California, Georgia and Missouri, as well as 3.1 million non-Blues members in states where it does not have the right to use the trademark (See chart).
The merger reflects a trend among Blues plans, which are increasingly joining forces to become more competitive. Continued consolidation has cut the number of Blues plans nationwide to 44 from 72 in 1990.
The Southeast and mid-Atlantic regions in particular are heating up, with Blues plans in New Jersey, New York, North...