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This is Jacob Emerson with the Becker payer

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issues podcast.

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Here's your bi weekly industry news briefing for

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June fifth.

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The nation's largest health insurers have signaled significant

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headwind in recent months across their Medicare Advantage

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and Medicaid businesses as costs rise and the

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effect, of of rude determinations takes hold.

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On May 20 ninth, United Health Group Ceo,

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Andrew Witty told analyst, the company is closely

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watching its Medicaid business. The Said we've come

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through this prolonged red determination cycle in Medicaid,

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making sure the utilization and the rate and

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everything else stay in perfect. Sync

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during a multi quarter cycle, there's probably going

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to be some disturbance around that.

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In April 20 23, states began the process,

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of dis enrolling Medicaid beneficiaries for the first

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time since the Covid Public health emergency was

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declared, which prevented state agencies from removing individuals

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from there in Medicaid rules.

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As of June fourth, at least 22700000.0

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people have lost Medicaid coverage, a direct hit

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to private insurers, enrollments. If Mc continue to

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lose members, but the enroll they retain use

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health care at to high rate, profits could

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suffer. Cent Ceo, Sarah London said may 30

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first. They are seeing pressure in their Medicaid

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book of business in April results, and that's

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largely due to the impact of the determination

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process, the we've been going through for more

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than a year now and the shift in

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acuity of the underlying population that remains after

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red

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nations. Health system owned insurers with Medicaid contracts

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have also been reporting significant losses to their

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enrollments,

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Texas Children's health plan in Houston laid off

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a few hundred employees after it lost 30

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percent of its members during red determinations. On

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the Medicare Advantage front, major carriers such as

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Cvs Health and Human have said they are

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looking to shrink enrollments and exit markets in

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20 25

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as the industry faces lower margins and rising

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Utilization rates among older adults. On May t,

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Bc cbs of Kansas city said it is

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leaving the M market at the end of

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20 24,

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citing increasing regulatory requirements and financial headwind.

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Notably, United Health said it is not planning

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Any major shake up to its Medicare business

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in 20 25,

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citing a long term strategy to adjust to

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industry pressures.

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Mister Witty told analysts inquiring about M competitors

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that right now, trying to pin the tail

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on the donkey of who gets what next

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year, if there's probably not much mileage in

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that.

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Well scan health plan has won its lawsuit

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against Cms that claimed the agency improperly calculated

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the payers 20 24 Met a Care Advantage

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star rating.

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Scan filed that soon in December after its

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star rating decreased from 4 and a half

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to 3 and a half stars, the A

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move that could have led to about 250000000

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dollars in missed quality bonus payments for the

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health plan and at the heart of why

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the company filed the lawsuits.

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According to its Ceo, doctor sac and Jai.

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Doctor Jane told backers that this decision reaffirm

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that star ratings actually matter. When there are

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these changes to the rules and how they're

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implemented, real people are affected by that. In

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this case, Medicare

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beneficiaries.

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In the June third ruling from the Us

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district court for Washington Dc.

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Judge Carl Nichols said Cms violated the rate

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of procedure act when it calculated scans 20

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24 rating using new methodology changes. A decision

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that could have sweeping industry consequence rate.

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Scan said the agency did not follow the

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correct rule making process when implementing the methodology

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changes and that it should have been given

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an overall star rating of at least for

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storm.

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M plans must receive star ratings of 4

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or higher to earn quality bonus payments from

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Cms, which can then be used to improve

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member benefits.

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Judge Nichols ordered that scans 3 and a

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half star rating be set aside and prohibited

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Cms from utilizing the original store

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score to calculate quality bonus payments. Other m

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carriers such as el Health and Z Health

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have filed similar lawsuits alleging that unlawful methodology

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changes that led to miss bonus payments,

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or terminated Medicare

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contracts.

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In March, Cms did increase the ratings of

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4 of El Medicare

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contracts, a move the company estimates,

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will lead to a hundred and 90000000 dollars

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and bonuses for payment year 20 25.

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Ina United Health Group says it is running

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around 500 use case applications for Ai across

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the organization.

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Ceo, Andrew Witty said some of the company's

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Ai efforts are, quote, low hanging opportunity entities

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aimed at speeding up administrative processes.

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He said it's not Einstein opportunities. These are

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relatively

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straightforward. Some of them are already underway. It

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they play out in areas like speed, allowing

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call handlers to deal with issues faster than

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they used to. Opt Ceo, Heather C and

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F told investors that Opt Ai efforts, they

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are focused in 2 areas. 1 is administrative

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support particularly for clinicians and giving them time

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back at home more in the office,

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The second area is identifying disease progression or

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emergency

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emerging disease faster.

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United Health executives previously said that Ai additions

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to their customer service offerings helped boost the

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company's net promoter scores, a measure of customer

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satisfaction.

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Their Well a former Astra

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executive is facing federal cyber stocking charges, poor

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allegedly sending violent threats to executives at Cvs

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Health Ae, following issues with personal claims reimbursement.

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That's according to a criminal complaint filed May

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eighth in a Delaware federal court.

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The individual was arrested on May eighth and

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charged with cyber stocking after more than a

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year of allegedly sending court traffic threats over

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email, facts, and mail to former and current

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president, along with Cbs Ceo Karen Lynch and

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other Ae employees. Traffic along with employees at

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Astra.

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The issue first began in November of 20

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22 when the individual sent a threatening letter

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to Ae former president

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regarding claims and appeals challenges related to his

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Crohn's disease treatments.

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Those threats continued through January of 20 23.

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Ae then noted the pharmaceutical company about the

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communications and the individual allegedly sending the letters

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was. Terminated.

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Executives that at and Astra though continued to

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receive graphically violent threatening letters from March 20

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is 23 to April of this year, which

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included threats to their minor aged children.

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The Fbi executed a search warrant at the

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individual's residence in Maryland in May where he

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was arrested. His arrangement is scheduled for June

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thirteenth.

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A possible dives buyer has backed out of

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a deal with United Health group and A

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that aim to make a proposed acquisition of

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the home health company more palatable to regulators.

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Of In May, the... It was reported that

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the q companies offered to sell 100 clinics

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to a private equity buyer and that United

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Health is still seeking a single purchaser of

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those facilities.

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Opt intends to acquire a medi in a

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3300000000.0

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dollar deal. It approved

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a it would... It got approved by shareholders

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in September, but the proposal is under review

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by the justice department. Lawmakers have also urged

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careful scrutiny of that proposal.

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Ci Ever North Care group plans to cut

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specific specialty service and consolidate certain Arizona care

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locations in the next few months. Those reductions

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will result in the termination of 261

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employees.

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In Phoenix.

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The decision comes as Ever North, Care group

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works to adapt to market conditions and evolve

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its strategy to meet patient and community needs

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in Employees affected by those layoffs will be

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provided a severance package, including transitional services.

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News of those workforce cuts comes out after

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Ever north sold 7 Phoenix based outpatient

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imaging centers to Rad, a diagnostic imaging provider

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in late January for an undisclosed amount.

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If you'd like the latest health insurance industry

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