The Kaiser Permanente-Geisinger merger: What it means for value-based care

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As regulators review Kaiser Permanente’s proposed acquisition of a respected health system based in Pennsylvania, health care experts are still puzzling over how the surprise deal, announced in April, could fulfill the managed care giant’s promise of improving care and reducing costs for patients, including in its home state of California.

KP said it would acquire Danville, Pennsylvania-based Geisinger — which has 10 hospitals, 1,700 employed physicians, and a 600,000-member health plan in three states — as the first step in the creation of a new national health care organization called Risant Health. The new entity will “expand and accelerate the adoption of value-based care in diverse, multi-payer, multi-provider, and community-based health system environments,” according to Kaiser’s latest financial statement. Oakland-based Kaiser Permanente said it expects to invest $5 billion in Risant over the next five years, and to add as many as six more nonprofit health systems during that period.