Washington state Insurance Commissioner Mike Kreidler confirmed March 2 that officials with Kaiser Foundation Health Plan have formally applied to acquire the Seattle-based Group Health Cooperative.
The Office of the Insurance Commissioner is set to review the proposed deal.
Kaiser’s documents include a public summary of the proposal, but the full application itself will not be disclosed until the insurance commissioner’s review is complete.
The proposal states that Kaiser would pay almost $1.8 billion to establish a new nonprofit Group Health Community Foundation. Additionally, Kaiser’s proposal promised that the insurer would spend $1 billion in the next ten years to expand facilities, research, equipment, and personnel in the state.
“The commissioner will consider the proposal’s effect on the overall stability of the health insurance market in Washington state, including competition and consumer choice,” Kreidler remarked regarding the review.
While the review is in Kriedler’s hands, 27,000 registered voters have until March 9 to submit ballots and influence the outcome. If two-thirds of the voting members approve of the plan, the review moves forward. Otherwise, Kriedler drops the review. According to a Group Health spokesman, the votes will be tallied by an independent tabulator, with the results to be announced by March 12.
According to reports by The Seattle Times, supporters of the deal insist that the acquisition is necessary “to ensure the future of care for Group Health members.”
Detractors say that Group Health did not provide members of the co-op enough time and information to consider the proposal. Critics also questioned the purpose and governance of the proposed foundation.
Regional public meetings related to the proposal will be held later this year. Once the review is finished, a formal public hearing will be arranged.
