HAP Acquires MHP for Medicaid Access

Health Alliance Plan (HAP) will acquire Midwest Health Plan (MHP), a for-profit Medicaid HMO with 74,000 members based in Dearborn, MI. The acquisition is pending federal and state regulatory approvals.

The acquisition gives HAP access to the Medicaid market. Michigan's Medicaid program, which today serves about 1.5 million persons, is expected to reach 2 million individuals by 2014 under expanded eligibility standards in the Patient Protection and Affordable Care Act (PPACA).

“Health Alliance Plan first began to explore the opportunity to enter the Medicaid program in 2009,” says HAP President and CEO, Bill Alvin. “We reviewed a number of options. The acquisition of Midwest Health Plan was determined to provide by far, the best synergies and opportunities for both Midwest Health Plan and HAP.

“The state is engaged in plans to reform its processes for ‘dual eligible’ people who have access to both Medicare and Medicaid,” Alvin says. “This acquisition will give HAP an opportunity to enter this market.”

HAP and Midwest share a common service area, which will create opportunities for operational efficiencies. Alvin says the acquisition will also position both companies for a future heavily influenced by the PPACA.

HAP intends to maintain MHP as a separate, wholly owned subsidiary under the proposed agreement. Dr. Mark Saffer, the founder of MHP, will maintain his position as president. Midwest Health Plan will continue to operate under the same name in its Dearborn headquarters. MHP members' access to providers, coverage and service will continue uninterrupted, according to HAP. No job losses are anticipated at either company as a result of the acquisition.

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