Baystate Health selling Health New England insurance subsidiary [masslive.com]

MassLive.com

SPRINGFIELD – Baystate Health is selling Health New England, its not-for-profit health insurance subsidiary, to an Eastern Massachusetts company.

The buyer is Point32Health, the not-for-profit parent company of Harvard Pilgrim Health Care and Tufts Health Plan.

Health New England has about 400 employees.

Terms of the sale were not disclosed.

“The parties reached mutually agreeable terms, however, our priority in the transaction was identifying a partner that shared the values with Baystate Health and could support HNE and the communities we serve,” Baystate said in a statement.

Health New England, based in Springfield, offers a range of plans in the commercial, Medicaid and Medicare markets and has approximately 180,000 members concentrated in Western Massachusetts.

The much larger Point32Health has 1.9 million members in Massachusetts, Maine, Connecticut, New Hampshire and Rhode Island.

“It is vitally important to the communities that we serve that Health New England and its programs continue to grow and evolve,” said Dr. Mark Keroack, CEO of Baystate Health.

Keroack said Point32Health is known for high-quality products, strong network and a commitment to underserved populations.

The sales agreement, unanimously approved by directors of Point32Health and trustees of Baystate Health, is subject to regulatory approvals, according to a news release.

Health New England was incorporated as a health maintenance organization (HMO) in 1985.

Point32Health said it will “harness the strengths of both organizations.”

It said it plans to combine strengths of the organizations to find efficiencies and broaden offerings to customers. It pledged to expand access to underserved populations and preserve not-for-profit options.

Enhancing high-quality, not-for-profit health plans is critical for health care in the state, said Cain A. Hayes, president and CEO of Point32Health.

“We are excited at the possibility of welcoming Health New England into the Point32Health family of companies,” Hayes said in a statement. “As the only two health plans in the state that serve commercial, Medicaid and Medicare populations, we have the commitment and expertise to serve people of all socioeconomic backgrounds, especially the underserved, and to improve quality of life through programs and services that improve whole person health.”

According to state data, Blue Cross Blue Shield has the largest market share in Massachusetts, with more than 1.6 million members enrolled in private commercial plans and public plans administered by private plans in the Bay State.