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Cigna Ties Up with DaVita Unit for New Healthcare Plans

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Cigna Corporation (CI - Free Report) recently announced a definitive agreement with HealthCare Partners, a division of DaVita Inc. (DVA - Free Report) . Per the deal, Cigna will provide integrated health care options to employers in and around Los Angeles. These healthcare plans, branded as “HealthCare Partners Select HMO”, will be available effective Apr 1. The integrated health care options basically aim at improvising the healthcare experience along with sustaining affordability and value for both the employees and employers.

Cigna has always been actively taking up inorganic growth strategies like acquisitions, mergers as well as partnerships. Its collaboration plans with Anthem Inc. was recently thwarted by the Federal judge, dealing a $1.8 billion blow to Anthem. Since then, the stock has been trading above the broader industry, gaining 0.47% as compared with the Zacks multiline insurance industry’s gain of 0.38%.

Coming back to the recent alliance with Healthcare Partners, both the companies have planned to offer health plans that will cover primary care physician services for employers with at least 100 workers. The eligible employers can also opt for a fully-insured plan or any other funding arrangements.

The new health plans are inclusive of medical, behavioral health, pharmacy, nurse case management and health coaching services. Employers will also have the privilege to add Cigna dental and vision plans as well as group life and disability programs. Customers adopting such plans will also have access to a network of HealthCare Partners providers, affiliated physicians and specialists, and hospital partners.

The health plans primarily emphasize on care coordination and health improvement. Smoother navigation of the system, new tools for health and wellness and better access to clinicians are the main pillars of these new models.

Cigna Collaborative Care, a value-based reimbursement arrangement, launched in Los Angeles in Apr 2013 had brought Cigna and Healthcare Partners together earlier. Management at both the companies deems the latest agreement as an extension to the preceding one.

In addition, the alliance with HealthCare Partners is said to be the third delivery system arrangement of Cigna as it already has similar arrangements with St. Joseph Hoag Health in Orange County and Scripps Health in San Diego. These local arrangements enable Cigna to offer a convenient solution to employers with workforces in multiple South Californian markets.

 

Zacks Rank and Stock to Consider

Cigna presently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A better-ranked stock from the same space is MGIC Investment Corporation (MTG - Free Report) , carrying a Zacks Rank #1. The company delivered positive surprises in three of the last four quarters, the average beat being 21.74%.

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