UnitedHealth will buy Surgical Care Affiliates for $2.3B

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UnitedHealth's purchase of Surgical Care Affiliates will position the combined organization as a comprehensive provider of ambulatory care services and expand OptumCare’s capabilities to include outpatient surgical procedures.

UnitedHealth Group will purchase Surgical Care Affiliates (SCA) for $2.3 billion, a move that will further expand its footprint in the healthcare market, which includes health plans, health systems, physicians and now ambulatory care.

The company announced the deal today, stating that it will combine its Optum business unit with the ambulatory surgery center and surgical hospital provider. The agreement calls for the company to acquire SCA for $57 per share.

The multibillion-dollar deal will position the combined organization as a comprehensive provider of ambulatory care services and expand OptumCare’s capabilities to include outpatient surgical procedures. Two years ago the company purchased MedExpress, which operates urgent care centers in 14 states.

SCA has 205 surgical facilities, including ambulatory surgery centers and surgical hospitals, and partners with appropriately 3,000 physicians.

“Joining with OptumCare will enable us to better support and empower independent physicians, helping them provide high-quality care for their patients while making healthcare more affordable,” said Andrew Hayek, chairman and chief executive officer of SCA, in the announcement. “The combination of SCA and OptumCare is another step forward toward our vision of becoming the partner of choice for surgeons. We already have a strong relationship with OptumCare, so we have seen firsthand that our cultures and strategies are aligned and complementary.”

Analysts from Leerink Partners said this morning that the firm had anticipated that the company was looking for an ambulatory surgery asset to expand its end-to-end primary care-driven ambulatory care delivery platform. OptumCare already targets 75 markets that includes primary care practices, they noted.  

They said that SCA will further OptumCare's vision of "building on the move to value-based care and further bend the cost trend with 20K affiliated physicians." 

The transaction will be funded with 50% to 80% UnitedHealth stock. It will also be neutral to the company’s forecast for 2017 earnings, according to Leerink.