Minneapolis-based Fairview Health Services has purchased Golden Valley, Minn.-based PreferredOne, according to the Minneapolis/St. Paul Business Journal.
Here are four things to know about the acquisition.
1. PreferredOne joined the state health exchange, then dropped out. After the insurer joined the MNsure health exchange and saw rapid growth, it began offering some of the cheapest premium prices in the nation. However, its dramatic growth quickly led to a financial loss of $139 million, and in 2014, PreferredOne announced its plans to drop out of the exchange for 2015.
2. The insurer was already partially owned by Fairview Health Services. Fairview previously had 50 percent ownership of PreferredOne. Robbinsdale, Minn.-based North Memorial Health Care and PreferredOne Physicians each had a 25 percent stake.
3. Fairview gave PreferredOne a loan last year. After the insurer's loss on MNsure, Fairview lent it $18.75 million. As part of the loan's terms, Fairview had the option of expanding its ownership of PreferredOne, according to the Star Tribune.
4. David Crosby will continue to serve as CEO of PreferredOne. The insurer will function as a subsidiary of Fairview, and Mr. Crosby will stay in his current role. He replaced previous CEO Marcus Merz, who retired at the end of 2014, according to the Star Tribune.