Tomorrow, the world.
Already on its way to building the largest mental health managed care company in the United States, Green Spring Health Services of Columbia yesterday announced its first international acquisition -- buying 80 percent of CHC, a Canadian operator of employee assistance plans.
Green Spring hopes to expand CHC's business in Canada, and is exploring opportunities in other countries as well, said Dr. Clarissa Marques, executive vice president and chief clinical officer.
Terms of the acquisition were not disclosed. The remaining 20 percent of CHC will be retained by its management.
With the pending $560 million acquisition of Merit Behavioral Care Corp. of New Jersey, which Green Spring hopes to close in February, Green Spring and its parent, Magellan Health Services of Atlanta, will be providing mental health coverage to 60 million Americans -- nearly one-fourth of the population. Green Spring functions like an HMO for mental health, getting paid by employers or insurers and contracting with therapists and mental hospitals for care.
"There's a whole world out there," Marques said. "If I do the 10-year bank book, there's a logical limit to our growth in the U.S. We want to continue to build on our expertise and our infrastructure."
She added, however, that growing internationally requires a "longer-term strategy" involving "careful research on funding mechanisms and on national values." Green Spring is concentrating on English-speaking countries, she said, although it may also look to serve overseas employees of American clients.
"We'd like to work with CHC on a uniquely Canadian strategy," Marques said. While psychiatry and inpatient mental health care are covered by the national health plan there, Green Spring and CHC see a possible growth in "short-term, crisis-intervention services" that can be an extension of existing employee assistance programs. CHC currently serves about a million members through contracts with 900 private employers and government agencies. Its revenues are about C$20 million -- roughly $14 million U.S. After the Merit deal is complete, Green Spring's annual revenues will be over $1 billion.
Marques said the deal would have no impact on employment at Green Spring's Columbia headquarters.
Pub Date: 12/17/97