Serco confirms US health services contract worth up to $1.25bn

Services company Serco Group has confirmed the award of a contract worth up to $1.25bn (£820m) to support the US’s Medicare and Medicaid services.

Under the contract, which has a one-year base period valued at around $115m with another four one-year options, Serco will provide processing support for the country’s health benefit exchanges designed to increase consumer choice and insurance competition.

Chief executive Christopher Hyman said:

We are delighted to be awarded such an important contract to support the Affordable Care Act in the United States and our Americas division looks forward to working with the Centers for Medicare & Medicaid Services. We have extensive experience in records management and processing for the US Government, and following the award of the Virginia transport management contract earlier this year we are making excellent progress in our strategy to further broaden the portfolio.

Shares are up around 0.3 per cent this morning.