UnitedHealth to acquire DaVita's primary care unit for $4.9 bn

Source Da Vita | Facebook

Source Da Vita | Facebook

DaVita Medical Group runs almost 300 primary and specialty care clinics in several states.

The announcement of the acquisition of a dialysis-center chain by a major insurer comes just days after drugstore chain CVS Health announced intentions to acquire a different major insurer, Aetna, for $69 billion plus assumption of debt.

Kidney-care provider DaVita had previously said that it was "pursuing strategic alternatives" for its physician operation, which has had bumpy financial results and recently surprised investors by driving down earnings for DaVita, which recorded a net loss in the third quarter. (DVA - Free Report) for almost $5 billion.

Consumers could also see their choice of doctor or pharmacy sharply limited under these arrangements as insurers attempt to steer patients into the groups over which they have the most control.

Denver-based DaVita operates medical groups in six states that serve 1.7 million patients through about 300 clinics, adding to UnitedHealth's 250 MedExpress urgent care centers and its 200 surgical centers that are part of recently acquired Surgical Care Affiliates. DaVita later expanded it.

"Following this transaction, DaVita will continue to be a leader in population health management, with a focus on our US and worldwide kidney care businesses", Kent Thiry, chairman and CEO of DaVita, said in the news release.

The transaction is expected to close in 2018 and is subject to regulatory approval and other customary closing conditions.

The possible threat of new competitors like Amazon entering the pharmacy business and technology companies delivering medical care through cellphones has led former adversaries to become partners, driving insurers to team up with hospitals and doctors' groups. The deal also includes the purchase of 35 urgent care centers.

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