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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JULY 06, 2010 12:00 AM (EDT)
A.M. Best Co. has placed under review with developing implications the financial strength rating of B+ (Good) and issuer credit ratings of "bbb-" of Mercy Health Plans of Missouri, Inc. (MHP MO) and its insurance affiliate, Mercy Health Plans (MHP). Both companies are domiciled in Chesterfield, MO.
This rating action follows the announcement by Coventry Health Care, Inc, that it has signed a definitive agreement to acquire MHP and MHP MO. The transaction is expected to close during early fourth quarter 2010. A.M. Best expects to meet with management of MHP and Coventry Health Care to address the integration and business strategy of the new organization.
The current ratings of MHP MO and MHP reflect enhancement through the companies' strategic role within and explicit capital support received from their existing ultimate parent, Sisters of Mercy Health System, Inc. On a stand-alone basis, offsetting factors include the decline in membership within the combined entity, significant operating losses at MHP and low risk-adjusted capitalization at both companies.
For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit Best's Ratings & Analysis.
The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at Best's Credit Rating Methodology.
Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers.