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-- Humana's commercial and Medicare Advantage medical membership
to increase by approximately 110,000, bringing statewide total
-- Humana's East Tennessee provider network to grow for
commercial and Medicare membership
LOUISVILLE, Ky.--(BUSINESS WIRE)--Aug. 4, 2008--Humana Inc. (NYSE:
HUM) today announced it has signed a definitive agreement to purchase
PHP Companies, Inc. (d/b/a Cariten Healthcare) ("Cariten"), from
Knoxville, Tenn.-based Covenant Health for approximately $245 million
in cash. The transaction is anticipated to close during the fourth
quarter of 2008 and is not expected to materially affect Humana's
earnings guidance for the year ending December 31, 2008.
Cariten is a health-benefits company serving commercial, Medicare
and Medicaid members in multiple counties throughout the eastern half
of Tennessee. As of June 30, 2008, Cariten's medical membership
-- 46,000 Medicare Advantage members
-- 34,000 commercial fully insured members
-- 30,000 commercial administrative-services-only (ASO) members
-- 99,000 Medicaid ASO members.
The Medicaid business relates to a TennCare program contract that
is scheduled to be completed on December 31, 2008, and will not be
"Covenant and Humana leadership worked together to develop a
relationship that will benefit employers, consumers and health care
providers in this region," said Humana of Tennessee President Evans
Looney. "Humana's national presence, local management and broad
product array combined with Cariten's local market presence and
knowledgeable associates will result in stronger benefit offerings for
East Tennessee consumers and employers."
"We are confident that our Cariten customers will reap substantial
benefits from the broad choice of commercial, government-sponsored,
and individual health insurance products that Humana will bring to
this marketplace," said Cariten Chief Operating Officer Doug Haaland.
"Cariten Senior Health members will benefit particularly from Humana's
expertise as one of the nation's largest and most experienced Medicare
Covenant Health President and CEO Tony Spezia called the
transaction "a great opportunity to form a strong, long-term
relationship with one of the nation's largest and most-respected
health insurance companies, which will benefit not only our members
but also our strong network of Cariten physicians and other healthcare
Banc of America Securities LLC acted as exclusive financial
advisor to Humana in its acquisition of Cariten from Covenant Health.
Citigroup Global Markets Inc. acted as exclusive advisor to Covenant
Health in the sale of Cariten to Humana.
The transaction is subject to regulatory approvals from the
Tennessee Department of Commerce and Insurance and the Centers for
Medicare and Medicaid. The transaction will also require a
Hart-Scott-Rodino filing with the United States Department of Justice
and Federal Trade Commission and clearance from these agencies.
This news release contains statements that are forward-looking.
The forward-looking items herein are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking items may be significantly impacted by certain risks
and uncertainties described in the company's Form 10-K for the year
ended December 31, 2007, its Form 10-Q for the period ended March 31,
2008 and Form 8-Ks filed during 2008, as filed with the Securities and
Humana Inc., headquartered in Louisville, Kentucky, is one of the
nation's largest publicly traded health and supplemental benefits
companies, with approximately 11.5 million medical members. Humana is
a full-service benefits solutions company, offering a wide array of
health and supplemental benefit plans for employer groups, government
programs and individuals.
Over its 47-year history, Humana has consistently seized
opportunities to meet changing customer needs. Today, the company is a
leader in consumer engagement, providing guidance that leads to lower
costs and a better health plan experience throughout its diversified
More information regarding Humana is available to investors via
the Investor Relations page of the company's web site at
www.humana.com, including copies of:
-- Annual reports to stockholders;
-- Securities and Exchange Commission filings;
-- Most recent investor conference presentations;
-- Quarterly earnings news releases;
-- Replays of most recent earnings release conference calls;
-- Calendar of events (including upcoming earnings conference
call dates and times, as well as planned interaction with
research analysts and institutional investors);
-- Corporate Governance information.
About Covenant Health
Covenant Health is the largest and most comprehensive health
system in East Tennessee. With $1.6 billion in assets, it is a
community-owned organization committed to improving the health of the
people it serves. The health system has received national recognition
and multiple awards for outstanding quality and patient satisfaction,
and innovative technology. Covenant Health is governed by a voluntary
board of directors composed of community leaders and medical
About Cariten Healthcare
Cariten was created in 1985 and today offers area employers a
choice of plans and services. These include PPO, POS, HMO and third
party administration services, as well as Cariten Senior Health HMO
and PPO Medicare Advantage plans. The company also offers Business
Health Solutions, a comprehensive approach to business behavioral and
workplace services. Supporting Cariten's members is a provider network
of more than 6,000 primary care and specialty physicians and 67
CONTACT: Humana Inc.
Regina Nethery, 502-580-3644
Jeff Blunt, 513-417-9134
Max Shell, 865-374-0429
SOURCE: Humana Inc.