Trinity Health more than doubled its operating income in the recently concluded quarter by selling its shares in a managed healthcare organization that provides Medicaid and Medicare plans in Pennsylvania.
The Livonia, Michigan-based health system received $127 million in proceeds from the sale of Gateway Health Plan to Highmark Health For the quarter ended September 30The non-profit company’s operating income excluding sales was $106 million, which is equivalent to an operating profit margin of 2.1%. Including sales proceeds, it was 4.7%. Trinity Health’s operating profit margin for the same period last year was 2.4%.
After the acquisition, Highmark Health renamed its insurance business and will sell Blue Cross and Blue Shield policies under the name of Highmark Wholecare.
According to data from Trinity Health, the transaction closed on August 31 and also brought the seller $62.5 million in dividend distribution and nearly $322 million in case proceeds. financial reportThe company did not respond to a request for comment.
Prior to the transaction, Highmark Health and Trinity Health each held a 50% stake in Gateway Health Plan, which had more than 355,000 members. The insurance company provides Medicaid programs in 40 counties in Pennsylvania and Medicare programs in 58 counties in Pennsylvania. Trinity Health’s subsidiaries Highmark Health and Mercy Health launched the Gateway Health program in 1992.
“Through this agreement, we can now take full advantage of Highmark’s innovative Living Health model to provide our members with a more coordinated, personalized, and technically supported experience,” said Karen Hanlon, Chief Operating Officer of Highmark Health and Interim CEO of Highmark Wholecare Said in a statement. Press release when the transaction is completed.
Trinity Health is a Catholic system with nearly 90 hospitals. Revenue for the quarter ended September 30 was slightly less than US$5 billion, compared with US$4.8 billion in the same period in 2020, an increase of 3.7% year-on-year. Expenses in the most recent quarter were US$4.9 billion, a year-on-year increase of 3.9%.