Minneapolis-based Fairview Health Services and health insurer UCare have signed a letter of intent to combine their operations.
Under the agreement, UCare will become a wholly owned subsidiary of Fairview. UCare and PreferredOne will make up Fairview's health plan division.
"This proposed combination mirrors a growing trend of payer/provider partnerships and has the potential to transform how healthcare is delivered and financed in Minnesota," said David Murphy, Fairview interim CEO.
UCare President and CEO Jim Eppel also expressed excitement about the transaction. "Combining forces with Fairview and its extensive, high-quality provider network will enable us to pave the way for a truly value-based and integrated system which better serves Minnesotans now and into the future," he said.
The organizations expect to finalize the transaction and receive regulatory approvals by mid-summer 2016.
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