A subsidiary of St. Louis-based Ascension Health plans to buy Sterling Heights, Mich.-based U.S. Health and Life Insurance Co. for $50 million, according to documents filed with the Michigan Department of Financial and Insurance Services.
USHL is licensed in about 20 states, including Michigan, Ohio, Illinois and Indiana. Ascension Health is the parent company of Warren, Mich.-based St. John Providence Health System, a five-hospital system, and nine other hospitals in Michigan.
Joseph Aoun, healthcare lawyer with Nuyen, Tomtishen and Aoun in Ann Arbor, said the acquisition of USHL will provide Together Health Network, a physician-led clinically integrated network, with the ability to participate in the state's health insurance exchange with its narrow provider network.
USHL's target market is small employers with less than 100 employees. It has received approval from the CMS to sell various policies for small employers under the Affordable Care Act.
Together Health is owned by two of the nation's largest healthcare systems, Ascension Health and Livonia-based Trinity Health. The two systems own 27 hospitals with more than 5,000 physicians on medical staffs in Michigan.
“The acquisition makes a lot of sense,” Aoun said. “Hospitals are now expected to manage population health and owning a health plan provides both infrastructure and a way to connect more directly with insurance purchasers.”
In 2013, USHL reported $67.4 million in net premium, about half of which was from Michigan. Its surplus was approximately $8 million. USHL is also affiliated with Automated Benefits Services, a Michigan third-party administrator, according to documents filed with the insurance department on Jan. 14.
The proposed acquisition of USHL will be through a newly formed subsidiary, Ascension Care Management, which states its “primary business is to own and operate businesses that are part of the population health management platform of Ascension.”
Anthony Tersigni, Ascension Health's CEO, is one of three directors of Ascension Care Management. The other two are top Ascension executives, CFO Anthony Speranzo and Joseph Impicciche, general counsel.
After the acquisition, USHL will be a wholly-owned subsidiary of U.S. Health Holdings, a Michigan-based corporation.
"Ascension Health subsidiary to buy Michigan health insurer for $50 million" originally appeared in Crain's Detroit Business.