A new health insurance company backed by Minneapolis-based Allina Health System expects to start selling coverage to large employers next year, and hopes to be in the state's Medicare market beginning in 2019.

In January, Allina announced a joint venture with health insurance giant Aetna that could provide one of the first significant examples in many years of new competition in the state's health insurance market.

Last month, the new for-profit health insurer obtained its license to sell coverage in Minnesota.

Allina Health and Aetna Insurance Company hope to make a selling point out of "care management" services provided by Allina staff — rather than an insurance company — that will coordinate care for efficiency, said Dr. Ben Bache-Wiig, an executive vice president at Allina.

"Care management … is often done by health plans via phone with a very low uptake — it feels intrusive and extra to many members," said Bache-Wiig, who is also chairman of the new company's board. "We've agreed that this will be done by Allina. With the clinical expertise and the more hands-on programs we bring, we think it will bring additional coordination value for our members."

The company is authorized to issue an aggregate total of 2 million shares' worth of common stock, with a par value of $1 per share, according to articles of incorporation filed with the state.

The corporation will launch with paid-in capital of at least $500,000, the filing says, and surplus finds that won't be less than $1 million.

In an interview Tuesday, Bache-Wiig did not comment on financial details.

"We have to build up a reserve capital base, we have to do a number of those pieces," he said. "We've worked through that with Aetna and have a model that we feel supports that well, without putting any significant strain on our core operations."

In Minnesota, large group health plans provide coverage to employers with 51 or more people. Allina-Aetna will target employers of this size that want to hire a company to take the financial risk for their health plan, or those that simply want administration services.

The goal is to start selling coverage to commercial groups with an effective date of April 2018, Bache-Wiig said. Pending regulatory approval, the insurer wants to sell Medicare health plans that would take effect in January 2019.

Initially, Allina-Aetna will sell coverage to commercial groups in the Twin Cities metro. Down the road, the company wants to expand elsewhere in Minnesota, Bache-Wiig said, and perhaps to western Wisconsin, where Allina owns a hospital and has relationships with physicians.

Currently, the company has one employee — a chief executive who works out of Allina's headquarters in Minneapolis.

Allina's entry into the health insurance world comes as health insurance companies and hospitals systems across the country are forging closer financial ties.

"Starting a health plan has inherent risks, particularly as its operations are very different than managing acute care facilities," analysts with Fitch Ratings wrote in a report about Allina earlier this year. "Joint venturing the plan with Aetna should help to minimize these risks as Aetna has engaged in similar JV in three other markets."

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck