Medicaid managed-care insurer Centene Corp. said Monday that it is buying Florida-based primary-care provider Community Medical Group.
St. Louis-based Centene, which is also the dominant health plan on the Affordable Care Act exchanges, said it expects the deal to close during the first quarter of 2018. The at-risk primary-care provider will bolster Centene's scale and care-delivery capabilities, allowing the health plan access to Community Medical Group's more than 70,000 patients.
The transaction is the latest in a string of deals seeing health insurers scoop up medical-care providers and outpatient practices to gain more control over where their members seek care. UnitedHealth Group's Optum subsidiary bought DaVita's medical group at the end of last year and acquired Surgical Care Affiliates in January 2017. Insurer Humana, along with two private equity firms, bought home healthcare provider Kindred Healthcare in December.
Community Medical Group operates 13 medical centers and two specialty centers serving more than 70,000 Medicaid, Medicare Advantage and Affordable Care Act exchange patients in Miami-Dade County, Fla. It offers primary-care and specialist-care services.
Centene served 848,000 Florida plan members at the end of last year, and that number is set to increase as the insurer expanded its footprint on the ACA exchange in Florida this year.
Centene also is waiting to hear if it will win a new five-year Florida Medicaid contract. Florida's Medicaid agency is expected to announce contract awards in April.
"The addition of CMG will provide Centene with a differentiated care delivery asset that shares our focus and commitment to government-sponsored programs and creates a foundation for future growth," Centene CEO Michael Neidorff said in a statement. "CMG's unique clinical care model, encompassing primary care, access to certain specialty services and a suite of social and other support services is delivering better health outcomes at lower costs, and is clearly aligned with Centene's purpose of transforming the health of the community, one person at a time."
Centene did not disclose the terms of the deal, but said it has the option of funding the purchase with cash or a combination of cash and stock.
Centene also announced late last month that it agreed to buy MHM Services, a provider of healthcare and staffing services to correctional facilities and government agencies. MHM Services provides behavioral health, medical and dental services to 330,000 people in more than 300 facilities nationwide. Already, Centene and MHM jointly own correctional healthcare services provider Centurion.