CHP: Healthfirst to buy Neighborhood Health Providers

NYAPRS Note: Based on current state plans, NYC based health plans that already provide medical and pharmacy benefits to Medicaid beneficiaries who also receive SSI (many for psychiatric disability) will play a leading role in the move of fee for service mental health and addiction treatment services to fully integrated Medicaid managed care special needs plans in 2014.

With that background, the purchase of Neighborhood Health Providers (served 17,649 Medicaid and SSI beneficiaries as of June) by Healthfirst (served 46,603 Medicaid and SSI beneficiaries) is notable. NYC based Health plans that served large numbers of Medicaid/SSI beneficiaries as of June 2012 included MetroPlus (35,668), NYS Catholic Health Plan (25,461), Amerigroup (24,480) and HIP of Greater NY (19,902). Calculations are taken from

http://www.health.ny.gov/health_care/managed_care/reports/enrollment/monthly/2012/docs/en06_12.pdf

 

Healthfirst to buy Neighborhood Health Providers

Crain’s Health Pulse  October 17, 2012

 

Healthfirst, the largest Medicaid managed-care plan downstate, has entered into an agreement to acquire Neighborhood Health Providers, a plan with its roots in the dwindling MediSys empire. Financial details were not disclosed. The transaction is subject to state regulatory approval and will take several months to close.

 

"We already are the biggest [Medicaid] plan in the New York City area, but this was the right opportunity to gain more scale and [do] a better job of making changes that are very important," said Healthfirst President and Chief Executive Pat Wang.

 

The economies of scale will help contain administrative expenses. Ms. Wang said the larger scale also will mean more efficient implementation of care coordination, and would afford an opportunity to improve care and member satisfaction.

 

The two plans have been discussing a deal for several months. "They wanted to sell, and we wanted to buy," she said. She had no information on whether NHP shopped itself around to potential buyers.

 

Healthfirst has 700,000 members, and is the sixth-largest insurer in the city, according to Crain's annual list of the largest health plans. Neighborhood Health is a 218,000-member Medicaid plan and ranked 12th, according to Crain's.

 

Ms. Wang said it was too soon to determine if there would be any layoffs from the consolidation, which is months away. Steven Bory, NHP's president and chief executive officer, and Ms. Wang have not discussed whether he will be staying on. "I have known him for 20 years and have tremendous respect for Steve," she said.

 

Healthfirst and NHP were both launched in the 1990s as provider-owned health plans. Healthfirst was an offshoot of GNYHA, while NHP was an offshoot of MediSys.

 

Healthfirst was advised by Mintz Levin and Morgan Joseph TriArtisan. NHP was advised by Foley Lardner and Houlihan Lokey.

 

http://www.crainsnewyork.com/article/20121017/PULSE/121019913#ixzz29YkcAOym