UNIHEALTH: MAY SELL ITS CAREAMERICA HMO
Burbank, CA-based UniHealth, an integrated delivery system,This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
is "considering severing its managed care arm," MODERN HEALTHCARE
reports. If UniHealth does sell the HMO, CareAmerica, "the not-
for-profit would be the latest integrated system to view the
selling of insurance as antithetical to its mission," according
to MODERN HEALTHCARE. Sources close to the deal said that
"UniHealth has asked Dean Witter to evaluate the strategic and
financial value of its units, including ... CareAmerica."
Sources said the evaluation also "seeks to determine any
potential market interest in CareAmerica, in a hotly competitive
environment in which large California plans are merging." One
source said, "CareAmerica is being shopped around," adding that
"two or three plans are interested" in the purchase. MODERN
HEALTHCARE reports that a "possible suitor" for CareAmerica is
Health Systems International, "whose strategy has been to acquire
provider-sponsored HMOs." CareAmerica's total enrollment is
263,200, with 43,600 Medicare enrollees. The HMO had total net
revenues of $529 million in 1995, and experienced a net loss of
$5.8 million in 1995. The HMO declined to release its 1996
results (Kertesz, 2/10 issue).