Consolidation among health plans took a step forward in the competitive Michigan market with the announcement last week of the sale of a smaller health plan to a larger provider-based health plan.
The move will give Priority Health, based in Grand Rapids, Mich., an entry point to the southeastern part of the state. Priority is purchasing the Care Choices HDM, Care Choices PPO and Preferred Choices PPO health plans from Trinity Health, Novi, Mich.
The deal is expected to close early this year, and no immediate changes are expected to the 100,000 HMO members and 43,000 PPO members served by Care Choices plans. The sale is subject to regulatory approval, which can take as long as 120 days.
Both organizations are not-for-profit and are sponsored by healthcare organizations. Terms of the sale were not announced.
Priority Health is jointly owned by three not-for-profit healthcare systems, with Spectrum Health, Grand Rapids, Mich., serving as the majority owner. Munson Health Care, Traverse City, and Northern Michigan Regional Health System, Petoskey, are minority owners of Priority Health, which serves 460,000 members in products ranging from HMOs, PPOs, HSAs, and Medicare and Medicaid plans.
"We look forward to expanding our business in southeast Michigan by offering employers and providers increased choice," said Kimberly K. Horn, president and CEO of Priority Health. "This acquisition doubles our network of the region's best hospitals and physicians."
Trinity Health is a multi-state delivery system. Based in Novi, Mich., the system operates 44 hospitals (29 owned and 15 managed) in seven states. The system, which employs 45,000 full-time staff, also operates 384 outpatient facilities, numerous long-term care facilities, and home health and hospice programs.
"As we explored strategic options for Care Choices, we knew it was important for all our stakeholders to keep the southeast Michigan market competitive," said Joseph R. Swedish, president and CEO of Trinity Health. "This is a positive step for Care Choices and the communities we serve."
While Trinity Health operates hospitals in several parts of Michigan, the majority are located in the southeastern part of the state in the counties surrounding the city of Detroit.