UnitedHealth aims to acquire physician-owned provider of radiology and other specialty services

UnitedHealth Group is seeking to acquire a physician-owned provider of radiology and other specialty services, according to a report published Tuesday.

The nation’s largest healthcare corporation has made an offer for the Corvallis Clinic in Oregon, which has 11 locations across the state’s Willamette Valley. Founded over 75 years ago, the independent multispecialty group offers radiology, primary care, physical therapy and other services, according to an application submitted to the Oregon Health Authority.

Corvallis Clinic leaders sought the sale because they are forecasting “material” financial shortfalls during the next 12 months, despite its physician owners taking a 15% pay cut over a year ago.

“Along with ongoing losses, further instability is expected as clinicians will seek employment opportunities where they can earn more competitive compensation,” according to the application. “The loss of physicians in the geographic service area would have a significant negative impact and result in decreased patient access and limit opportunities for health equity initiatives if the proposed transaction is not completed.”

Corvallis Clinic contends that the proposed transaction would “significantly stabilize” healthcare services in the region, providing the practice with financial support and subject-matter expertise. If the deal closes, UnitedHealth said it plans to conduct a thorough review of the physician group’s operational challenges and workflows to find opportunities to align with its Optum Oregon business.

The Lund Report first shared news of the proposed transaction, noting that UnitedHealth now employs or is affiliated with about 10% of all physicians in the U.S. If approved, this would mark the company’s third such move in Oregon, with UHG previously acquiring the nine-clinic Oregon Medical Group in Lane County and another two-location organization in Portland. However, this is the first of the three deals to undergo the local health authority’s merger review process, with the previous two acquisitions occurring prior to the program launching. All told, Optum Health employs nearly 90,000 physicians, the report noted.

Corvallis Clinic’s staff includes about 100 docs and other advanced clinical professionals but no radiologists. The organization operates X-ray, ultrasound, CT and MR scanners through its imaging department, but contracts with outside rads for the reads, CEO James Kaech told Radiology Business by email.

Read more from the Lund Report here:

Marty Stempniak

Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic. 

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