Reliant approves Optum acquisition

Reliant Medical Group CEO Tarek Elsawy said aligning with OptumHealth will position the doctors group for continued success.

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By Emily Micucci

Reliant Medical Group doctors and trustees unanimously voted to be acquired by OptumHealth, a Minnesota-based division of national insurer UnitedHealth, the Worcester-based physicians group announced Tuesday evening.

The statement followed an offsite meeting in which 230 physician members voted on the deal. For-profit Optum can now proceed with plans to acquire Reliant, a Worcester-based physician group that has been independent since its founding in 1929. Reliant trustees voted to approve the deal in April.

Details about the sale, including a price and transaction date, were not available Wednesday morning. A UnitedHealth spokesman did not return requests for comment by deadline and Reliant did not reveal those details.

Reliant spokesman Michael Masseur said the vote is a key step in ensuring the group stays at the forefront of delivering high-quality health care in the region.

“Reliant expects to bolster its ability to grow and expand, modernize many of its clinical facilities, have access to advanced data analytics capabilities, and attract top medical talent to its practices,” Masseur said in an email statement.

Reliant and Optum will now move forward with a definitive agreement, though the deal is subject to state regulatory review and approval, Masseur said.

Should the agreement move forward, Reliant would continue to be locally operated and serve patients under the Reliant Medical Group brand in the Central and Metrowest regions, including Southborough Medical Group offices, which were acquired by Reliant in 2015, said Masseur.

He added Reliant’s workforce of about 2,500, including physicians, staff and management, would not change as a result of the transaction. The medical group would continue to serve patients through multiple insurance plans.

“This is the beginning of a process that will strengthen Reliant and position the organization for continued success in the ever-changing and challenging healthcare industry,” said Tarek Elsawy, president and CEO of Reliant.

Stand still or move forward

The doctors’ vote follows a previous unanimous vote of approval by the Reliant Board of Trustees. Trustee Kevin O’Sullivan, president and CEO of Massachusetts Biomedical Initiatives in Worcester, said a sale to Optum is the right strategy for Reliant, given the uncertain financial outlook for healthcare providers.

“The board and the doctors all gave this thing great thought, were very pensive about it,” O’Sullivan said. “You stand still or you move forward.”

O’Sullivan noted Reliant, a nonprofit with $677.5 million in annual revenue and one of the region’s top 10 largest employers, will become a taxpayer in the cities and towns where it owns real estate, if the sale to for-profit Optum passes. Reliant has offices throughout Central Massachusetts and in MetroWest, including its Southboro Medical Group locations.

For its home city of Worcester, additional commercial tax revenue is important and needed, said Timothy Murray, president and CEO of the Worcester Regional Chamber of Commerce. Murray said he hopes Reliant will continue its role as a major provider and employer under Optum’s ownership, adding Optum has carved out an important niche focused on efficient healthcare delivery and technology.

“Those are key ingredients in bending the healthcare cost curve,” Murray said.

Meanwhile, Lynn Nicholas, president and CEO of the Massachusetts Health and Hospital Association, issued a statement Wednesday following news of the vote. Though she did not comment specifically on the planned acquisition, Nicholas said such deals will increase as the healthcare system undergoes rapid transformation.

“Partnerships between physician groups and hospitals and health systems, or physician groups and hospitals and insurers, will be more common in the future as these entities strive to deliver care within a framework of a population health approach,” Nicholas said.