Insurer Amerigroup Corp. said Tuesday it will pay $85 million to buy Health Plus, a New York Medicaid managed-care company.
Amerigroup, based in Virginia Beach, Va., said Health Plus serves about 320,000 members in New York State's Medicaid, Family Health Plus and Child Health Plus programs and is one of the largest Medicaid managed-care companies in New York. Amerigroup covers about 2 million people in 11 states.
The deal, which is subject to regulatory approvals and other closing conditions, is expected to close in the first half of next year. Amerigroup said integration and one-time transaction costs will hurt its earnings next year but the acquisition will add to earnings after that.
Health Plus is owned by New York nonprofit hospital and health care network Lutheran HealthCare, which plans to use the purchase price to establish an endowment.
Health Plus expects to generate about $1 billion in revenue this year.