Peoples Health, which was founded in 1994 by medical providers, was one of the first companies to offer Medicare Advantage plans in Louisiana. Since then, the company has grown from 3,200 members in three parishes to more than 63,000 statewide, ranking it second in the state behind Humana. Peoples Health has about 850 employees.
In late 2016, when Peoples Health had more than 55,000 members, the company posted $710 million in revenue.
Medicare Advantage programs, which are privately run, give members a specific network of health providers and hospitals from which they can receive service. The plans usually offer coverage for more services, such as preventive dental care or routine vision care, and programs to help manage health conditions.
"Our joining together will lead to an expanded choice of affordable plan options for Louisiana seniors and build on Peoples Health’s high-touch, personalized approach to taking care of members," UnitedHealthcare said in a statement.
The price for Peoples Health was not disclosed. The deal is still pending regulatory approval, but physicians-owned Peoples Health said the transaction will be completed as soon as possible.
UnitedHealthcare, the nation's largest health insurer based in suburban Minneapolis, was ranked fifth in Fortune magazine's list of America's 500 largest companies.
The company already has a strong presence in Louisiana, with more than 876,000 customers in the state through its Medicare, Medicaid and employer-sponsored plans. It has about 700 employees in the state.
Both Peoples Health and UnitedHealthcare said they are committed to maintaining business as usual for Louisiana employees, so they can focus on taking care of customers.
Officials with Peoples Health said the deal will not have any effect on the company’s Medicare Advantage plans in 2018.
Medicare Advantage programs have grown in popularity in recent years. Since Congress passed the Affordable Care Act in 2010, Medicare Advantage enrollment has gone up by 71 percent, according to a report released in mid-2017 by the Henry J. Kaiser Family Foundation. The report noted that UnitedHealthcare accounted for 24 percent of plan enrollment nationally in 2017.
While UnitedHealthcare had the biggest share of the U.S. market, it lagged behind in Louisiana. Peoples Health had the second-biggest share of the Medicare Advantage market in Louisiana, accounting for 22 percent of the market. Humana Inc. had 62 percent of the business, and Vantage Holdings ranked third with a 6 percent share. Remaining Medicare Advantage plan insurers in the state combined account for 10 percent of the market.
Currently, one in three people with Medicare are enrolled in Medicare Advantage programs. That figure is expected to grow to 41 percent over the next 10 years.
“Joining with UnitedHealthcare preserves our foundation as a local company with deep ties to Louisiana while creating greater stability and enhancing what we offer to the people we serve,” Peoples Health said in a statement. “There’s no better partner for us as we look to navigate a rapidly changing industry and grow into an even stronger health plan.”
Peoples Health members can continue accessing care from doctors, hospitals and other medical facilities in their provider network. Customers can call the number on the back of their Peoples Health member ID card if they have any questions.