PacificSource buying insurer: The takeover of Clear One Health Plans will get the Springfield company into Medicare and Medicaid [The Register-Guard, Eugene, Ore.]

Dec. 31--SPRINGFIELD -- PacificSource Health Plans announced Wednesday that it is acquiring Clear One Health Plans, a Bend-based health insurer, in a deal valued at $46 million.

The deal is the latest in a string of acquisitions for PacificSource, a nonprofit Springfield health insurer that provides health benefits to about 200,000 people in Oregon and Idaho.

Shareholders of Clear One, a publicly traded company, will receive $26 per share, which represents a premium of 167 percent over the closing price on Tuesday of $9.75 per share. Clear One will become a wholly owned subsidiary of PacificSource.

The deal must clear state and federal regulatory hurdles and most likely won't close until the second quarter of 2010, said Ken Provencher, president and CEO of PacificSource.

The acquisition supports PacificSource's strategy to increase its presence in Central Oregon, expand into Medicare and Medicaid markets and improve its ability to collaborate with health providers to improve quality of care, he said.

With major reform to the nation's health insurance system brewing, PacificSource leaders decided it was important to get involved in Medicare and Medicaid, Provencher said.

PacificSource does no business with Medicaid and Medicare.

Clear One "has a nice book of business in that area and nice expertise," Provencher said. Clear One has about 10,500 Medicare members and 26,500 Medicaid members, as well as about 10,000 members with commercial insurance.

"My read on reform, and changes in the market place, is that there's a couple of things that are going to happen no matter what," Provencher said. "There's more and more business that will come through some government route, whether through existing programs or new programs" or health insurance exchanges.

"Our sense is, to be an effective player in the long run, we better be able to play in the government sector."

"This is an excellent opportunity for Clear One members, providers, and employees to become part of a leading organization," said Clear One CEO Patricia Gibford.

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