Humana will join a privately held company to invest $ 1.2 billion in about 100 new CenterWell Elderly Care Clinics between 2023 and 2025, the company announced this week.
It will be the second joint venture between Humana and Welsh, Carson, Anderson & Stowe (WCAS), a New York-based investment firm focused on healthcare and technology, to operate primary care clinics for Medicare patients. The companies have a previous $ 800 million joint venture agreement to open 67 clinics in early 2023 and support ongoing operations, according to a Humana and WCAS press release.
“We are thrilled to grow our partnership with Humana to improve access to senior-centered, value-based primary care in the United States,” David Caluori, general partner of WCAS, said in a press release. . “We look forward to continuing our work with the CenterWell team to deploy their scale care model.”
WCAS will own the majority of the new clinics, and Humana will own a minority stake and manage and operate the payroll independent clinics under the Humana CenterWell Senior Primary Care brand. Humana, based in Louisville, Kentucky, has claimed to be the nation’s largest provider of senior-centered primary care, operating 214 clinics under the CenterWell Senior Primary Care and Conviva Care Solutions brands.
“Both physicians and patients are coming to recognize the many benefits of our unique, elderly-centered primary care model,” said Reneé Buckingham, president of the Human Primary Care Organization. press release. “Doctors and nurses who spend more time with patients, paying more attention to both the physical and mental aspects of health and following a team approach allow for personalized, value-based care that helps improve lives. Early success has increased interest in our independent payer model, and with this new joint venture, we look forward to significantly expanding our geographic footprint and serving even more patients in more communities across the country. ”
CenterWell Senior Primary Care has clinics in Nevada, Missouri, Texas, Louisiana, Florida, Georgia, South Carolina and North Carolina, while Conviva Care Solutions operates in Texas and Florida. Existing clinics serve about 180,000 patients with Medicare value-based agreements, along with 58,000 patients under independent practice partnership agreements through Conviva Care Solutions, according to Humana. By the end of 2022, the company expects to have about 250 clinics, adding an additional 30 to 50 clinics a year by 2025.
Under the new joint venture agreement, CenterWell Senior Primary Care will receive a management fee, including performance-based incentives, to operate the joint venture clinics. The companies announced that the agreement includes buying and selling options through which Humana can acquire WCAS’s stake in the joint venture from 2028 or five years after the opening of each cohort of clinics, and through the which WCAS may require Humana to acquire its interest in the joint venture. company begins in 2030 or seven years after the opening of each cohort of clinics.
The deal is not expected to affect Humana’s earnings in 2022, according to the company. On April 27, Humana reported adjusted first-quarter earnings of $ 1.34 billion.
WCAS was founded in 1979 and has raised and managed more than $ 30 billion. The firm has more than 190 current or former companies in its portfolio in the healthcare and technology industries, according to its website.
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