Maxicare to Sell 3 Units for $14 Million
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Troubled Maxicare Health Plans Inc. of Los Angeles said it had agreed to sell health maintenance organizations in Texas, New York and New Jersey to a subsidiary of New York Life Insurance Co. for $14 million.
Maxicare, which is saddled with $474 million in debt accumulated during an ambitious expansion in the early 1980s, announced the agreement Tuesday and said the money would be used to help pay claims in its health plans.
Sanus Corp., a health insurance subsidiary of New York Life, agreed to buy Maxicare New York Inc. and Maxicare New Jersey Inc., the company said. The HMOs have a combined 12,000 members.
Sanus also agreed to buy Maxicare Texas Inc. in Houston. The 125,000-member plan is two-thirds owned by Maxicare and one-third owned by Kelsey-Seybold Clinic, which treats most of the members.
The deal, subject to regulatory approval and completion of related real estate transactions and other matters, is expected to close soon.
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