PacificSource Purchase Expands Market Share

Once state regulators approve the purchase of Advantage Dental’s commercial business, PacificSource moves into the individual dental market

July 15, 2009 -- PacificSource Health Plans is gearing up for a tidal wave of new members when state regulators approve its $3.5 million purchase of Advantage Dental Plan’s commercial business.

 
For the first time PacificSource will have members in the state of Washington, where it has an insurance license, and also move into the individual dental market in Oregon, Washington and Idaho. With the sale, its dental business will nearly double – going from 32,301 members (as of June 2009) to nearly 62,000.
 
Advantage’s dentists will become the exclusive providers and have signed a three year non-compete contract with PacificSource.
 
Both parties have asked state regulators to approve the sale by July 20 with PacificSource preparing to assume the business on Aug.1
 
“That’s an extremely quick turn around since the papers didn’t land on my desk into early July,” said Richard Frawley, CFE, an insurance financial analyst with the Department of Consumer and Business Services. “We’re taking a fair and reasonable approach to make certain all the nuts and bolts are complied with. There are no time limits for approval.”    
 
PacificSource has a strong financial position in the marketplace. On March 31, it had $226 million and assets including $93 million in capital and surplus. Its overall membership reached 131,053 on June 30. 
 
For its part, Advantage Dental shows no signs of weakness. In June it had assets totaling $4.5 million with $4 million in stockholder equity. Advantage is owned by its dentists. For 2009 it projected premiums of $6.4 million, with claims reaching $5.1 million and $1.3 million in operating expenditures, $60,000 in investment income and $30,000 in net income.
 

Unlike Advantage, in its filing with DCBS, PacificSource didn’t disclose all of its financial information, calling those records confidential and citing an Oregon statute dealing with trade secrets which could give its competitors an unfair advantage

 

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