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Group Health, MedCenters merge
Star Tribune: Newspaper of the Twin Cities
August 20, 1992
Author: Gordon Slovut; Staff Writer

Group Health and MedCenters Health Plan, two of Minnesota's largest health maintenance organizations, announced Wednesday that they have merged - but there's a potential hitch.

"We're still reviewing it [the proposal] for possible antitrust ramifications," said Susan Gretz, a special assistant in the antitrust division of the Minnesota attorney general's office.

George Halvorson, president of the unnamed holding company that began managing and marketing Group Health and MedCenters Tuesday, said the U.S. Justice Department approved the HMO merger two weeks ago and notified the state.

"The state has not taken any action and there is no deadline for the state to take any action so we have gone ahead, assuming state approval," Halvorson said.

The merger would leave Minnesota with just three major health plans, down from six a few years ago. A similar merger trend has resulted in a clumping of most hospitals in the Twin Cities area into three large systems.

Walter McClure, a Minneapolis-based health policy analyst, said he fears the merger may decrease competition among health plans in the Twin Cities.

Objections from the attorney general's office delayed the merger this month of the parent organizations of two of the state's largest hospitals, Abbott Northwestern in Minneapolis and United in St. Paul.

The merger of Group Health and MedCenters was encouraged by the Business Health Care Action Group, a coalition of 14 major Twin Cities employers, which got more than a dozen health care plans and alliances to bid to provide care through the coalition.

As of Dec. 31, Group Health and MedCenters had a combined membership of about 553,000 enrollees.
Section:  BUSINESS
Page:  03D
Copyright (c) 1992, 2001 Star Tribune: Newspaper of the Twin Cities