Centene settles with Amerigroup over scuttled deal

Centene, Amerigroup settle dispute over buyout of NJ Medicaid assets, deal to go forward

• On 12:33 pm EDT, Saturday October 24, 2009

ST. LOUIS (AP) -- Centene Corp. said Saturday that it has settled a legal dispute with Amerigroup Corp. over that company's decision to back out of a deal to buy pieces of a New Jersey Medicaid business from Centene.

Centene said in a statement that the transaction is expected to proceed because of an agreement between Centene subsidiary University Health Plans Inc. and Amerigroup New Jersey Inc. Subject to regulatory approval, the deal is expected to be completed during the first quarter.

The St. Louis health insurer did not offer details of the settlement, but said the parties have released claims from the litigation. Amerigroup did not make an announcement, and a phone message left with a spokeswoman for the Virginia Beach, Va., company was not immediately returned.

In November, Centene said Amerigroup agreed to acquire its University Health Plans subsidiary, which serves about 55,000 members. Amerigroup later tried to back out of the deal, citing "a material change in the business of University Health Plans." Amerigroup did not elaborate. In January, Centene sued its rival, arguing that Amerigroup didn't have cause to stop the sale.