Avera Health buys DAKOTACARE insurance

December 15, 2015

Avera Health plans to increase its share of the insurance market in South Dakota by buying DAKOTACARE. The sale is expected to be finalized Dec. 30; the price was not disclosed.

With its ownership of Avera Health Plans and DAKOTACARE, Avera will become the second largest health insurer in South Dakota, serving nearly 200,000 members. Before the deal, Avera Health Plans insured more than 80,000 members in South Dakota and nine counties in northern Iowa.

Avera plans to operate each of the brands as separate entities. Both plans are for-profit entities.

"It's a great brand and we share a lot of the same values," Jay Gravholt, director of media relations for Avera Health, said of DAKOTACARE. "It was created by the physicians of the state and they've done a wonderful job. We want to honor that tradition and offer the people of South Dakota a lot of options." DAKOTACARE began in 1986 as the health care plan of the South Dakota Medical Association.

Avera Health Plans, founded in 1999, provides access to a network of 92 hospitals, 2,000 primary care providers and 4,000 total providers, including doctors employed by Avera. The plans are sold to individuals, families and employers. Avera also markets Medicare supplement plans. It offers plans for residents of South Dakota and nine counties in Iowa through federal health insurance exchanges.

DAKOTACARE includes 100 percent of South Dakota's hospitals and more than 98 percent of the state's physicians and pharmacies, according to a release from Avera. It sells plans to individuals, families and employers but did not offer plans for 2016 through the federal health insurance exchange.

The Sioux Falls, S.D.-based Avera Health system has more than 16,000 employees, providing health care in more than 330 locations and 100 communities in Iowa, Minnesota, Nebraska and South Dakota.


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