Business

Tacoma’s Northwest Physicians Network bought, sold in the span of about a week

UnitedHealth Group Inc.'s campus in Minnetonka, Minn. UnitedHealth Group Inc. said Wednesday, Dec. 6, that its Optum segment will buy the DaVita Medical Group from DaVita Inc. in a cash deal expected to close next year.
UnitedHealth Group Inc.'s campus in Minnetonka, Minn. UnitedHealth Group Inc. said Wednesday, Dec. 6, that its Optum segment will buy the DaVita Medical Group from DaVita Inc. in a cash deal expected to close next year. Associated Press file, 2012

It’s been a whirlwind time for Tacoma-based Northwest Physicians Network.

On Nov. 28, DaVita Medical Group, part of Denver-based DaVita Inc., announced its acquisition of the independent physicians association, which includes more than 1,000 primary care and specialty care doctors.

“Welcoming Northwest Physicians Network to DaVita Medical Group is a key step in growing our footprint in the region and expanding our IPA network from South Seattle down into Northern Oregon,” Joe Mello, chief operating officer for DaVita Medical Group, said in a news release announcing the deal.

Then, eight days later, came the announcement that UnitedHealth Group’s OptumCare division was acquiring the DaVita Medical Group for about $4.9 billion.

The transaction is expected to close next year, pending regulatory approval.

DaVita plans to use the sale’s proceeds to cover “significant” stock repurchases within two years, repay debt and for “general corporate purposes,” as reported in the announcement of the deal.

The quick turn of events was not so sudden of an idea.

In early November, DaVita CEO Kent Thiry suggested during a company earnings call that the company could be looking at divesting the medical group after years of disappointing returns.

“Following this transaction, DaVita will continue to be a leader in population health management, with a focus on our U.S. and international kidney care businesses,” Thiry said in his company’s announcement of the Optum deal. “We also expect to pursue other investments in health care services outside of kidney care.”

The purchase of DaVita Medical Group, which has medical groups in California, Colorado, Florida, Nevada, New Mexico and Washington, will expand the market reach of Optum.

“Patients will further benefit from the sharing of best practices across both organizations,” Optum said.

As for the Northwest Physicians Network, Mello “will continue in a leadership role in the combined entity, as will the DaVita Medical Group leadership team,” according to Optum.

Northwest Physicians Network went looking for a buyer in the first place to gain a partner as it sought to grow.

“We knew we needed to find a partner with access to resources, expertise, and, most importantly, an alignment with our fundamental values,” Dr. Scott Kronlund, the group’s president and chief medical officer, said in DaVita’s news release in November.

“With their commitment to physician independence, physician leadership and focus on clinical excellence, DaVita Medical Group was the natural choice,” he said.

The acquisition also was expected to lead to a greater partnership with The Everett Clinic, a part of DaVita Medical Group, and potentially expand the choices of patients and providers, according to the network.

DaVita, for its part, made news in August with its announcement that it would move its remaining 500 Tacoma employees to Federal Way in the next four years.

That meant vacating a 10-story tower in the heart of Tacoma’s downtown, at Pacific Avenue and South 15th Street.

In 2012, DaVita announced that a third of its workforce was moving to the Weyerhaeuser campus in Federal Way.

Debbie Cockrell: 253-597-8364, @Debbie_Cockrell

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