Frigid temperatures this weekend prompt cold weather advisories

MPR News helps you turn down the noise and build shared understanding. Turn up your support for this public resource and keep trusted journalism accessible to all. 

Turn Up Your Support

Managed care company UnitedHealth Group
Inc.'s Optum business plans to buy the operations of Southern
California physician group Monarch HealthCare.


      Terms of the deal were not disclosed Thursday by Optum, which
provides health management, consulting and pharmacy services.


      UnitedHealth, based in Minnetonka, Minn., is the largest health
insurer based on revenue and second only to WellPoint Inc. in
enrollment. Monarch, founded in 1994, has more than 2,300 doctors
who provide care for about 200,000 residents of California's Orange
County.


      Optum CEO Larry Renfro said in a statement that Optum shares
Monarch's "commitment to bringing patients, physicians, hospitals
and health care payers closer together in the mission to increase
the quality and affordability of care."


      Analysts say insurers are showing a growing interest in
expanding into other elements of health care delivery. Jefferies
analyst Arthur I. Henderson said in a research note he expects
insurers to move more proactively into employment-like deals with
care providers to lower costs by improving care coordination.


      Bernstein analyst Ana Gupte said in a separate note the Optum
deal supports her view that managed care companies will vie with
hospitals in a "land grab" for doctors.


      Last fall, UnitedHealth competitor Humana Inc., based in
Louisville, Ky., announced the purchase of Concentra Inc. for about
$790 million. Concentra delivers occupational medicine, urgent
care, physical therapy and wellness services from more than 300
medical centers in 42 states. It also operates worksite medical
facilities.


      More recently, Indianapolis-based WellPoint said it completed an
acquisition of CareMore Health Group, which provides Medicare
Advantage coverage and coordinated care for about 54,000 people in
California, Arizona and Nevada. Medicare Advantage plans are
privately-run versions of the government's Medicare program, which
provides health coverage for the elderly and disabled.


      Gupte also said better care coordination was a factor behind
doctor practice acquisitions, which she expects to continue. She
called UnitedHealth's deal "the right strategic move."


      "We expect more such deals to be consummated across the
industry, as the move to health cost containment becomes a fiscal
imperative," Gupte wrote.


      UnitedHealth shares rose 6 cents to $47.58 in afternoon trading.
      
      
      
      

Gallery

Business and Economic News

Managed care company UnitedHealth Group
Inc.'s Optum business plans to buy the operations of Southern
California physician group Monarch HealthCare.


Insurer UnitedHealth to buy California doc group

Go Deeper.

Like this?