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Anthem Boosts Integrated Care With Aspire Health Buyout

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Anthem, Inc. (ANTM - Free Report) has completed the acquisition of Aspire Health, a non-hospice, community-based palliative care provider. The deal is aimed at providing unique and innovative medical care to the community outside hospitals.

The company anticipates the buyout to be neutral to current-year earnings but accretive to the bottom line in 2019.

Aspire Health provides services under contracts with above 20 health plans to patients across 25 U.S. states. The company identifies patients suffering serious illnesses and helps them fight fatigue, shortness of breath, nausea, appetite loss and depression through supreme medical care.

Anthem already owns Blue Cross and Blue Shield plans in 14 states and purchasing Aspire Health would enable it to enhance its medical care business, providing better services along with other clinical care assets, namely CareMore Health and AIM Specialty Health. Through this transaction, Anthem plans to introduce advanced illness programs to deliver optimum patient satisfaction via home-based care, reducing medical costs in the process.

Palliative care is fast gaining ground as the U.S. healthcare system shifts to value based care from a volume based one. The consolidation should aid Anthem to dispense treatment affordable costs to patients with complex medical conditions. Thus this move might effectively lower overall medical costs, boosting margin expansion in the process.

The Aspire Health deal is projected to be a kind of vertical integration for Anthem and will craft it into a more wholesome and integrated healthcare service provider.

Vertical tie-ups are anyways in vogue in the healthcare industry with two mega deals comprising Express Scripts Holding Company by Cigna Corp. (CI - Free Report) and Aetna Inc. (AET - Free Report) by CVS Health Corp. (CVS - Free Report) being already underway. Both these transactions are the combination of a health insurer with a pharmacy benefit manager.

Year to date, the stock has gained 8.5% compared with the industry’s rally of 13.8%.


Anthem carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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