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Bravo Health is the latest Maryland business involved in a merger or acquisition, as the Baltimore health insurance company agreed to be purchased for $545 million by HealthSpring of Nashville, it was announced Friday. The deal is expected to close by December.

Bravo, which has grown rapidly since forming in 1996 and now has more than 1,000 employees with about 650 in Baltimore alone, and HealthSpring are "a natural fit," Jeff Folick, chairman and CEO of Bravo Health, said in a conference call.

Bravo provides Medicare Advantage, a privately-operated health insurance program sponsored by the federal government for seniors, to about 100,000 people in Maryland, Washington, D.C., Delaware, New Jersey, Pennsylvania and Texas. HealthSpring is one of the nation's largest Medicare Advantage providers, operating in numerous states that Bravo does not, such as Alabama, Florida, Georgia, Illinois, Mississippi and Tennessee.

Both companies have developed a "unique reimbursement structure that rewards cost effective and improved quality outcomes," Folick said. "We intend, as a stronger combined company, to be leaders in this industry for many years to come," he said.

The combined company will become the seventh largest Medicare Advantage provider in the country and the ninth largest stand-alone prescription drug plan provider, executives said.

Company deals in general have heated up this year, as globally about $1.5 trillion worth of mergers and acquisitions have been announced through Aug. 23, some 20 percent more than in the same time in 2009, according to Thomson Reuters data.

Earlier this month, United BioSource, a Bethesda drug and device research business, agreed to be bought for $730 million by Fortune 100 pharmacy benefits manager Medco Health Solutions of Franklin Lakes, N.J.

Bravo has had a strong financial year so far, with $833 million in premium revenue in the first six months of 2010, Folick said. The company recently added its 100,000th Medicare Advantage member, up from some 77,000 in December.

HealthSpring had about 197,000 Medicare Advantage members as of June 30, up from some 189,000 in December. The public company saw net income in the second quarter almost double from a year ago to $55.8 million, while premium revenue in the quarter rose 12.6 percent to $756.3 million.

Bravo will expand the geographic range of HealthSpring, with the combined company becoming the market leader in the Philadelphia area, said Herbert Fritch, chairman and CEO of HealthSpring. He called it a "meaningful transaction for us."

kshay@gazette.net