OptumHealth has signed a deal to buy Logistics Health of La Crosse, Wis., which does business with the military and federal government.
UnitedHealth Group continues to expand its reach into health services.
The UnitedHealth subsidiary OptumHealth said Monday it has signed a deal to buy Logistics Health Inc., a rapidly growing Wisconsin company that provides wellness programs and conducts physicals and other evaluations for the federal government. Terms were not disclosed.
Separately Monday, UnitedHealth said it aims to fortify its market presence in the health services arena by pooling its related businesses units under the Optum name. OptumHealth will keep its name. Ingenix, the information and research company, will become OptumInsight. And Prescription Solutions will be OptumRx.
The three companies, which will continue to operate under current management, have combined revenue of $25 billion, giving Optum the scale of a Fortune 100 enterprise, UnitedHealth said in a release.
As for the OptumHealth acquisition, the deal faces an antitrust review from the Department of Justice, which could take 30 to 60 days.
OptumHealth, based in Golden Valley, generates more than $5 billion in revenue by providing wellness plans and behavioral services to businesses, health care providers and county and state governments.
Logistics Health Inc. (LHI), with headquarters in La Crosse, Wis., was founded in 1999 and has about 900 workers. Last month it inked a five-year, $635 million contract with the Department of Defense to provide disability exams to veterans. The contract is expected to add up to 400 new jobs in the La Crosse area over the next year.
LHI also provides pre-enlistment physicals, dental care and postdeployment follow-up for military service members. About 90 percent of its business comes from federal contracts, which also includes health and wellness services for the Department of Health and Human Services.
The deal was first reported by the La Crosse Tribune on Saturday.
The two companies "share a common focus on providing innovative health services that support the needs of individuals and organizations," said Brian Kane, a spokesman with OptumHealth. "In particular, LHI has earned a tremendous reputation for meeting the unique needs of the men and women of the U.S. Armed Forces, and we would be honored to have the opportunity to support LHI's dedicated employees in growing that important work."
UnitedHealth has been vying to win two multibillion-dollar contracts to administer health care to military members, their families and veterans.
"We are excited to have an opportunity to partner with a health services leader who can provide us with a greater breadth of resources for enhancing and expanding our capabilities," said Tracey Armstrong, marketing director at Logistics Health Inc., via e-mail. "OptumHealth shares both our focus on providing the most innovative health, wellness and behavioral solutions and our commitment to the La Crosse community."
Jackie Crosby • 612-673-7335