UnitedHealth expands with new Florida acquisitions

The company buys two Medicare Advantage plans that also operate primary care clinics or medical centers.

By — Posted March 20, 2012

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UnitedHealth Group is expanding its presence in Medicare Advantage and direct care delivery with the purchase of two Florida health plans.

United, based in Minnetonka, Minn., announced Feb. 28 that it agreed to buy two plans separately: Coral Gables, Fla.-based Medica HealthCare Plans (unrelated to Minneapolis-based health plan Medica) and Preferred Care Partners, based in Miami.

The financial terms of the deals were not disclosed.

Preferred Care has about 50,000 Medicare Advantage Members and 5,000 Medicaid members. Medica has 35,000 Medicare Advantage members and 7,200 Medicaid beneficiaries.

The Preferred Care purchase will include six primary care centers, and the Medica HealthCare Plans deal includes two medical centers in Coral Gables and Hialeah, Fla., according to United's announcement.

United did not disclose whether it would directly employ physicians or other health care professionals at those sites, or any other details about the way the clinics would operate when they become part of United.

Partly because of the potential for the insurer to employ physicians at its newly owned clinics, the acquisition is worth monitoring, although the Florida Medical Assn. has no official policy on the deal, said Mike Wasylik, MD, an orthopedic surgeon who chairs the FMA's Council on Medical Economics.

He said physicians and insurers' motivations can be at odds. "They're trying to make money, and were trying to take care of patients."

United said in a statement that the deal will "enhance UnitedHealthcare's offerings in Florida."

Tim Monaghan, a health care attorney and partner at Shutts & Bowen, a West Palm Beach, Fla., law firm, said the purchase makes sense in the context of health system reform and the technological demands of operating in a post-reform world. It's much easier to adopt the necessary technology when you own the physicians, hospital and the health plan, he said.

"That's what I see happening when I see UnitedHealth buying up all these plans," he said. "When you can accumulate 200 or 300 doctors and 20,000 or 50,000 patients you can choose one [electronic health record] and roll it out in one fell swoop," he said.

Humana, Highmark and Cigna also own their own hospitals or clinics or physician groups.

The move into owning physician practices hasn't been entirely smooth for UnitedHealth Group. United subsidiary Optum, which has been running Orange County, Calif., independent practice association Monarch Physicians for less than a year, is in a dispute with another insurer.

Blue Shield of California has accused Monarch of violating its contract with Blue Shield, under which Monarch physicians were supposed to care for Blue Shield HMO and Medicare Advantage members. Blue Shield filed a demand for binding arbitration with the American Arbitration Assn.

Monarch physicians have turned away Blue Shield members and encouraged them to change health plans, according to a Blue Shield news release. Blue Shield plans to terminate its contract with Monarch in May, citing the alleged breach of contract. Blue Shield also is seeking $10.5 million in damages for lost income and goodwill.

Monarch CEO Bart Asner, MD, said in a statement that the organization was unaware of any Blue Shield patients being turned away from Monarch physicians' offices.

"We object to the mischaracterizations made by Blue Shield," he said.

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