Primary care provider Cano Health acquires University Health Care for $600 million

Senior primary care provider Cano Health has acquired medical provider University Health Care for $600 million.

The bolt-on acquisition grows Miami-based Cano’s projected 2021 revenue to as much as $1.5 billion. The combined company has 143,000 members, 88 medical centers and more than 1,000 staff and affiliated providers nationwide. The news comes amid a flurry of activity in the primary care space, with insurers and providers racing to capture stakes of the growing Medicare Advantage market.

The purchase was funded using $540 million in cash and $60 million in common equity issued to University’s shareholders. Cano expects full-year membership could reach as high as 162,000 by year’s end. Combining with University added 24,000 Medicare Advantage members, 13 facilities and more than 300 providers to Cano’s platform.

Cano is a Medicaid and Medicare-focused provider that runs value-based primary care clinics for seniors in Florida, Texas, Nevada and Puerto Rico. It went public by combining with a special purchase acquisition company backed by billionaire Barry Sternlicht.

Cano runs population health programs that include telehealth, prescription home delivery, wellness programs and complex care management. Half of its members are dual eligible for Medicare and Medicaid and 80% are Latino or African American.

University Health Care has operated in the South Florida market for 25 years. It offers primary care, transportation to and from appointments, wellness programs and pharmacy services.

In a news release, the companies said their models are both high-touch and high-tech.

“University is a premier provider of value-based care, and we are thrilled to welcome the world-class University team to the Cano Health family,” Cano CEO Dr. Marlow Hernandez said in a statement. “Our model has proven effective at providing industry-leading outcomes while controlling costs, and we look forward to delivering care at a larger scale than ever before.”

Last week, primary care provider One Medical announced it plans to buy Iora Health, a Medicare-focused primary care provider for $2.1 billion.