UnitedHealth will acquire DaVita’s physician group for about $4.9 billion in cash. DaVita Medical Group operates nearly 300 clinics across a half-dozen states — including the Everett Clinic, which provides care to patients in Snohomish and King counties.
In another example of the blurring boundaries in the health-care industry, UnitedHealth Group, one of the nation’s largest insurers, said it is buying a large physician group to add to its existing roster of 30,000 doctors.
UnitedHealth’s Optum unit will acquire the physician group from DaVita Inc. for about $4.9 billion in cash, subject to regulatory approval.
DaVita Medical Group operates nearly 300 clinics across a half-dozen states — including the Everett Clinic, whose nearly 400 physicians provide health care to more than 320,000 patients in Snohomish and King counties, according to its website. DaVita’s main business is operating a chain of for-profit dialysis centers.
With the purchase of the physician group, UnitedHealth is increasingly moving into the direct delivery of medical care.
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“Combining DaVita Medical Group and Optum advances our shared goal of supporting physicians in delivering exceptional patient care in innovative and efficient ways,” Larry Renfro, Optum’s chief executive, said in a statement.
The proposed deal comes on the heels of news of another big insurer, Aetna, and its plans to merge with CVS Health. That transaction would transform drugstores into community-based health-care “hubs,” where people can go for a blood test or for help managing a chronic disease like diabetes. Executives at Aetna and CVS claim that this new model will result in better care and lower costs for patients.
At a time of increasing uncertainty in the health-care marketplace, insurers, hospitals, doctors and drugstores are looking outside their traditional businesses to join forces. The Republicans’ proposed tax overhaul could sharply cut payments to federal programs like Medicare as well as upend the Affordable Care Act. Employers and consumers, meanwhile, are increasingly concerned about the high cost of medical care.
The possible threat of new competitors like Amazon entering the pharmacy business and technology companies delivering medical care through cellphones has led former adversaries to become partners, driving insurers to team up with hospitals and doctors’ groups. They are seeking to deliver care in novel ways, outside the expensive setting of a hospital. While the combination with CVS allows Aetna to experiment with providing medical care in a retail setting, insurers are also looking to partner directly with doctors and health systems.
Through its Optum unit, which operates a large pharmacy benefit manager and offers a wide array of health-care services, UnitedHealth Group is among the most diversified and the most successful of the large insurers.
The acquisition of DaVita Medical Group — which manages physician groups in California, Colorado, Florida, Nevada, New Mexico and Washington, and sees about 1.7 million patients a year at its 300 clinics, 35 urgent-care centers and six outpatient surgery sites — is the latest move by UnitedHealth to expand into the realm of delivering medical care as a way of reducing costs. The company already operates medical practices in Southern California and elsewhere, and it owns nearly 250 MedExpress urgent-care clinics. The clinics offer much of the same care available at a hospital emergency room but at a reduced cost.
Last January, UnitedHealth also acquired a chain of surgery centers, a move the company said could lower the expense of having an outpatient surgery by more than 50 percent. The company expects to perform roughly 1 million surgeries and other procedures this year.