Jefferson Health has acquired the remaining 50% stake in Health Partners Plans (HPP) from Temple University Health System for $305 million, now making it the sole owner of the nearly 290,000-person managed care plan.
Announced Monday, the deal makes good on a 2019 agreement between Jefferson and Temple. Jefferson had already acquired a quarter of HPP through its acquisition of Aria Health System in 2016 and its more recent merger with Einstein Healthcare Network.
The Philadelphia-based health system said its purchase will springboard a push toward value-based care and reduce the costs of healthcare services for plan members.
“This will help HPP care for more marginalized patient populations and provide access to critical, lifesaving and value-based care, while expanding their provider network to include all Jefferson Health locations,” Jefferson Health President Bruce Meyer, M.D., who will also chair the HPP board of trustees, said in a statement. “The pandemic has drawn attention away from the national dialogue around total cost of care. Our ownership of HPP will help us bend the cost curve for the communities we serve.”
Temple will continue to be an in-network provider in HPP’s network, according to the announcement.
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HPP was founded in 1984 and for much of that time was jointly owned by Philadelphia-region hospitals. It provides Medicaid, Children’s Health Insurance Program, Medicare Advantage and Dual Eligible Special Needs plans to the residents of several Pennsylvania counties.
Jefferson said in the announcement that its board of trustees was unanimous in its purchase decision, seeing full ownership of HPP as “a vital and consequential strategic priority” that would allow the nonprofit to build an integrated delivery and financial system.
“With the addition of HPP to the Jefferson family, our ability to provide health assurance to everyone starting at their home takes a giant step forward,” Stephen Klasko, M.D., president of Thomas Jefferson University and CEO of Jefferson Health, said in a statement. “Tackling health inequities and improving the health of our populations requires true coordination and combining the resources of HPP with the expanding Jefferson provider base is a prescription for better health for people in our community.”
In the announcement, the fellow Philadelphia academic health system said it decided to sell off its share of the managed care plan to fuel future strategic investments and growth of its core operations.
“Proceeds from the sale give us a new degree of flexibility to recapitalize the [Temple Health], obtain cash flow to strengthen our investment in people and programs and fortify our balance sheet,” Michael Young, president and CEO of Temple University Health System and Temple University Hospital, said in a statement. “Providing quality, value-based care to our vulnerable patient populations is a vital aspect of Temple Health’s business model and we remain a participant in HPP’s network—while also expanding shared-savings, direct-contracting and other shared risk models with [the Centers for Medicare and Medicaid Services], commercial insurers, [Federally Qualified Health Centers] and others to further accelerate Temple Health’s resurgence while remaining focused on the highest quality and efficiency for the community we serve.”