published Monday, October 24th, 2011

Cigna to buy Healthspring

Staff File Photo
The Cigna building is in downtown Chattanooga across from Warehouse Row.
Staff File Photo The Cigna building is in downtown Chattanooga across from Warehouse Row.
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Cigna Corp., announced today that it will buy Nashville-based HealthSpring Inc. for about $3.8 billion to boost its business selling Medicare plans for the elderly.

The move represents a significant diversification for Cigna, which has largely focused its U.S. health plans sold to medium and large size businesses.

Cigna, which employs more than 1,300 workers in its Chattanooga claims processing office, has agreed to pay $55 a share to buy HealthSpring, a 37 percent premium over the closing price on Friday.

Cigna says the boards of directors for both companies have approved the deal. It is expected to close in the first half of 2012.

“HealthSpring is a great fit with Cigna's growth plans to expand into the seniors and Medicare segment through a premier business and trusted brand name,” Cigna CEO David M. Cordani said in a statement today. “Our two companies share a common strategic vision and philosophy that we create customer value by partnering with health care professionals, and use information and incentives to deliver high-quality, differentiated programs.”

Medicare Advantage plans are privately run versions of the government’s Medicare program. They are subsidized by the government and offer basic Medicare coverage topped with extras or premiums lower than standard Medicare rates.

HealthSpring has about 340,000 Medicare Advantage customers in 11 states.

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about Dave Flessner...

Dave Flessner is the business editor for the Times Free Press. A journalist for 35 years, Dave has been business editor and projects editor for the Chattanooga Times Free Press, city editor for The Chattanooga Times, business and county reporter for the Chattanooga Times, correspondent for the Lansing State Journal and Ingham County News in Michigan, staff writer for the Hastings Daily Tribune in Nebraska, and news director for WCBN-FM in Michigan. Dave, a native ...

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eastridge8 said...

I worked for CIGNA for 10 yrs and I'm not real happy about this as I have HealthSpring insurance....higher premiums and non-coverage is in store for us.

October 24, 2011 at 6:27 p.m.
gmomma said...

WOW, I have HealthSpring and was already about to drop it because of the limited Dr's to choose from and then I don't get to see a Dr. (see nurse practitioner) So, now they will only have 339,000 customers in 11 states.

October 25, 2011 at 9:54 a.m.
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