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Group Health makes offer for KPS
If all goes as planned, Bremerton-based KPS Health Plans could be acquired by Group Health Cooperative by the end of summer.
The Washington State Office of the Insurance Commissioner approached Group Health a couple months ago asking the nonprofit integrated health care system to consider purchasing KPS which also is nonprofit and provides preferred provider organization (PPO) health plan options. Due to financial problems, KPS has been under the financial control of the state Office of the Insurance Commissioner since August 1999.
I believe that this sale is a positive development from all perspectives, said state Insurance Commissioner Mike Kreidler. It serves the interests of subscribers, providers, the company and the community. KPS is a Washington would retain its nonprofit status under Group Health, another Washington-based nonprofit with a proven record of performance.
Although Group Health will own KPS if the deal goes through, KPS will run as a separate company and will keep its name for at least four years.
According to Kreidlers office, under the terms of the proposed sale, Group Health has pledged to keep the identity of KPS, maintain operations in Bremerton and provide an infusion of capital that would ensure a more certain future.
The two organizations could be very successful together, said Jim Truess, executive vice president and chief financial officer for Group Health. Our vision for the future is for KPS to expand coverage in a broader area across the state, it should be a positive thing over time. (KPS) will be financially stronger and well look at how to develop this company. This is a good thing, (KPS) is doing a good job, its had some financial issues but is doing a great job for consumers.
Truess does not expect KPS policy holders or policies or benefits to be affected by the sale and said it will provide a broader set of options.
As part of the intended sale, Group Health will return 50 percent of the $6 million in surplus notes that local providers, pharmacies and hospitals signed to keep the company operating in the early days of the receivership, according to