Ascension and Centene Corp. have signed a letter of intent to explore a joint venture to establish a Medicare Advantage plan that would serve as a preferred model for their respective systems and affiliates in multiple geographic markets beginning in 2020, the St. Louis-based companies announced Monday.
The Ascension system includes more than 50 senior living and care facilities and 153 hospitals, according to its website.
“Working with Centene to create a new Medicare Advantage plan aligns with our mission of serving those who are vulnerable and struggling the most, which all too often includes our seniors,” Ascension President and CEO Anthony R. Tersigni, EdD, FACHE, said in a statement. “We look forward to developing innovative, transformational approaches to serve this growing population in the many communities we serve as part of our advanced strategic direction.”
Among the other undertakings announced by Ascension this year are a global supply chain joint venture with Sydney, Australia-based Ramsay Health Care; a new nonprofit generic drug company that will aim to benefit senior living residents and others — with Trinity Health, SSM Health and Intermountain Healthcare in consultation with the Veterans Health Administration; and a partnership agreement that saw Presence Life Connections communities become part of Ascension affiliate Ascension Living.
The Medicare Advantage-related letter of intent signed by Ascension and Centene is non-binding, and the joint venture is subject to due diligence, the negotiation of definitive terms and approval by each company’s board of directors, among other conditions, the companies said.
“This joint venture will bring together two leaders with decades of experience across markets and creates an opportunity for scaled payer-provider collaboration,” Centene Chairman and CEO Michael F. Neidorff said. “We share a commitment of serving the underserved and intend to leverage the best capabilities of both organizations to provide high-quality, affordable healthcare to support the needs of low-income seniors.”
Large health systems increasingly are showing interest in insurance. In a second-quarter earnings call on Friday, Welltower CEO Tom DeRosa noted that such systems have paid attention to the real estate investment trust’s recent deal with ProMedica in part because of the health system’s “very successful insurance business.”
“Many health systems, if they’re not already in that business, are looking to figure out how they are able to offer Medicare Advantage and Managed Medicaid programs — again, all with the idea of keeping the patient or consumer in a circle of wellness, to minimize risk in the future,” he said.