In Brief: Molina Purchases Mental Health Services Provider; Dignity Health Reports FY 2015 Earnings
Molina Purchases Mental Health Services Provider
Long Beach-based Molina Healthcare has entered into an agreement to acquire some of the assets of an Arizona-based mental health services provider for $200 million.
Under the terms of the all-cash deal, Molina would acquire Providence Human Services and Providence Community Services, both affiliates of the Providence Service Corp. They provide servics in 23 states. Molina officials have suggested that the deal would be used to beef up its Medicaid managed care service offerings.
We are excited to enter into this strategic transaction with The Providence Service Corporation,” said J. Mario Molina, M.D., Molina's chief executive officer. “The PHS and PCS platforms, coupled with their extensive experience in Medicaid, will enable us to complement our health plan offering with behavioral and mental health and other services that focus on social determinants of health. Providing access to these types of quality services is imperative, as we increasingly arrange for healthcare services for patients with complex needs.”
The deal is expected to close sometime in the fourth quarter of this year.
In an unrelated item, Molina announced that a data breach had occurred affecting 54,000 of its enrollees.
According to Molina, the breach occurred through CVS, which provides over-the-counter medications to Molina enrollees. A former CVS employee stole the information and downloaded it to his personal computer, officials said.
Dignity Health Reports FY 2015 Earnings
Dignity Health reported a significant reduction in its self-pay patients and charity care writeoffs and higher inpatient volume but a lower overall profit for its 2015 fiscal year.
Altogether, the San Francisco-based Dignity reported net income of $558 million on revenue of $12.4 billion for the fiscal year ending June 30. That compares to net income of $885 million for fiscal 2014. The company did not report its fiscal 2014 revenue.
Dignity Health said the revenue included 18 months of Medi-Cal provider fees that included the second half of fiscal 2014, but whose release by state and federal officials had been delayed.
Charity care writeoffs declined 17% to $144 million, while the number of self-pay patients declined 28%. Officials attributed those changes to the increased number of insured from the Affordable Care Act (ACA).
The company's investment income of $178 million for the fiscal year was lower than in fiscal 2014, although it did not release the prior number.
"We remain on the forefront of this historic transition, and Dignity Health will continue to be a leader in the industry for innovation and quality care," said Dignity Chief Executive Officer Lloyd Dean. "In order to realize the full potential of health reform it is vital that all sectors of the industry work together to build a national health system that truly works for people. Dignity Health will continue to be part of the solution to the healthcare crisis."
