December 6, 2017

UnitedHealth Group to buy Denver-based physician network for $5B

United Healthcare's Hartford offices.

Minnesota-based health insurer UnitedHealth Group Inc., which has a strong presence in Hartford, said Wednesday that its Optum division will buy a Denver-based medical group for $4.9 billion.

The acquisition of DaVita Medical Group comes on the heels of CVS Health Corp.'s planned $69 billion acquisition of Hartford insurer Aetna, in which both companies plan to launch expanded health services in CVS stores.

DaVita Medical Group, a subsidiary of DaVita Inc., serves 1.7 million patients a year through nearly 300 medical clinics featuring primary and specialist care. DaVita Medical Group also operates 35 urgent-care centers and six outpatient surgery centers. It operates in California, Colorado, Florida, Nevada, New Mexico and Washington.

DaVita Inc. also provides kidney care centers but UnitedHealth Group is not buying those outlets.

Optum provides physician-led primary, specialty, in-home, urgent- and surgery-care services.

"Combining DaVita Medical Group and Optum advances our shared goal of supporting physicians in delivering exceptional patient care in innovative and efficient ways while working with more than 300 health care payers across Optum in ways that better meet the needs of their members," said Larry C. Renfro, CEO of Optum.

DaVita Medical Group will become part of the OptumCare division, which already works with more than 80 health plans to serve millions of consumers annually through 30,000 affiliated physicians and hundreds of care facilities.

Joe Mello, DaVita Medical Group COO, will continue "in a leadership role" in the combined entity, along with the group's leadership team, Renfro said.

The deal is expected to close in 2018, subject to regulatory approval and closing conditions.

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