Watts Health To Sell HMO
Watts Health Foundation announced on Tuesday that it will sell its UHP Healthcare HMO to Care 1st Health Plan for $30 million, the Los Angeles Times reports.
The estimated total debt of the foundation, which filed for bankruptcy protection in May 2005, is about $40 million, according to Watts Health attorney Gary Klausner.
Foundation Board of Directors Chair Johnny Darnell Griggs said Watts Health now will focus on charitable work to promote health through educational and other programs.
Most of the HMO's 80,000 members obtain medical or dental coverage through Medi-Cal or Medicare. Foundation officials said members should see little change in their coverage if the deal is approved by state regulators and the U.S. Bankruptcy Court.
Care 1st offers plans only through Medi-Cal, but purchasing Watts Health's HMO will allow it to expand to Medicare and dental plans, according to Walter Gray, Care 1st vice president of business development. Gray added that 90% of the health plans' provider networks overlap and that Care 1st would seek contracts with the remainder of UHP's providers to ensure continuous coverage for beneficiaries.
Care 1st also will donate $500,000 to the foundation's charitable efforts under the deal (Yi, Los Angeles Times, 4/12).