BUPA has finalised the deal to buy Coventry cash plan provider, Mercia Health Benefits, and as part of the agreement has said it will invest £4 million in the company to guarantee its financial stability in the future.
In addition, BUPA will be donating a further £450,000 to the Coventry and Warwickshire Charitable Trust.
This donation will be used to buy medical equipment, fund research as well as welfare projects and help adults and children who have disabilities.
Mercia Health Benefits provides cash benefits for hospital stays and towards the cost of primary care.
The cash plan provider also owns a medical centre with optical and therapy services and access to a dental practice.
It covers some 125,000 people nationally. This is made up of some 60,000 subscribers and their families, with the bulk of subscribers primarily based in Coventry and Warwickshire.
Subscribers are mainly pensioners, factory and office workers who pay between £1.10 to £6.20 a week to gain access to cash benefits.
But recently the cash plan provider lost one of its biggest subscribers when the 4,500 employees of Coventry City Council pulled out of the scheme.
Prior to the takeover, Mercia Health Benefits, which was founded 128 years ago, had been investigated by the Department of Trade and Industry over concerns about its finances.
It was claimed the company had spent nearly £250,000 on property belonging to its former chief executive as part of a relocation deal.
There were also accusations that the not-for-profit company was spending thousands on corporate entertaining.
BUPA’s director of new businesses Stephen Flanagan said the takeover would provide a “stable financial future” for Mercia’s customers.
Commenting on the deal Flanagan said: “BUPA has operated cash plans for some time and recognises the need for services like those received by Mercia customers.”
He added that it was BUPA’s intention to retain the Mercia brand and its presence in Coventry.