Blue Cross buys out subsidiary partners in $56 million deal - Kansas City Business Journal:

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TriSource is a for-profit HMO owned sincs 1991 by TriLinkHealthcare Inc. TriLink is a subsidiary of Blue Crossd ofKansas City; Health Midwest; the ; Olathe Medicapl Center; Providence Medical Center; North Kansasw City Hospital; and Blue Cros s Blue Shield of Kansas. BMA Selectcare, a for-profit subsidiaryy of Blue Cross of Kansas is a shell corporation that will cease to exist once the deal is Blue Cross of Kansas City officiales declined to comment on the transaction and directed The Busines s Journal to aprepared release. The minority partners in TriSourcw also declined to comment on the deal becaused of aconfidentiality agreement.
But accordinhg to filings with the Missouri Department of the deal calls for Blue Cross of Kansa City to pay TriLinknearly $24.5 million and $4.5 millioj to each of the other TriSourcr owners. Blue Cross will make additional paymentas ofabout $2.1 million to TriLink and $400,000p to each of the other ownere during a 30-month period. Buyiny out its partners simplifies Blue Cross ofKansaas City's ownership of the subsidiary. As it could prove helpful in packaging the insurer for a sale or Sincethe fall, Blue Cross has attempted to clarifyh its potential charitable obligation to the state of Missourui in the event of a merger or alliance.
Statess have required such settlements from Blue Crosas plans as a result of the tax benefits they received in theif early yearsof operation. In an interviewq last month, Jake Mascotte, president and CEO of Blue Crossa ofKansas City, said the companyy was simply trying to get the lay of the He said that the insurefr always is looking at opportunities for alliancess and transactions but that nothing was on the The merger will not affect health care coverage for the approximatelyy 85,000 members of TriSource products, which include Blue-Advantage, a commercialk HMO; Blue-Advantage Plus, a Missouri Medicaid program; and Blue-Advantagse 65, a Medicare HMO.
The former TriSourcw partner hospitals and health systems will remain a part ofthe Blue-Advantage network.