Carmel-based Sagamore Health Network will keep its name even thought it has been acquired by Cigna Corp.
The Philadelphia-based health insurer said its acquisition of Sagamore, Indiana's third-largest managed care organization, will make it much more competitive in the state. In Indiana, Anthem Insurance Co. dominates the health insurance market.
"It also adds significantly to the range of health benefit choices available to Indiana consumers, and in the process, brings strong new competition to the state's health benefits and services marketplace," said David Cordani, president of Cigna HealthCare.
One Indianapolis health care expert said Cigna's purchase of Sagamore should be good for employers.
"It's going to help Cigna with employers," said Ed Abel, director of health care at Blue & Co., a local accounting firm. "They're [now] bringing a lot more providers to the table."
Anthem, a unit of Indianapolis-based WellPoint Inc., has 1.7 million customers here. Cigna has 150,000 health customers and 110,000 dental customers.
Anthem has more customers than its two nearest competitors combined, according to IBJ research. Sagamore claims 700,000 customers and Indianapolis-based The Healthcare Group claims 705,000.
Terms of Cigna's acquisition were not disclosed. However, a Cigna official said the acquisition would add $15 million to $20 million of revenue per year.
Cigna partnered with Sagamore earlier this year to give Cigna's customers access to some of Sagamore's providers.
"This transaction is a natural outgrowth of our excellent working relationship with Cigna," Sagamore President Greg Yust said in a written statement. He added, "We'll be able to offer Sagamore payers and producers an even greater range of product and service options."
Sagamore is a network of 37,000 doctors, 210 hospitals and 1,100 ancillary providers. Sagamore leases its network to employers and health insurers, whose workers and customers receive lower prices when they obtain care from the providers in Sagamore's network.
Sagamore was created in the mid-1980s by groups of Catholic hospitals. It is owned by the parent companies of St. Vincent Health and St. Francis Hospital and Health Centers, as well as the St. Joseph Regional Medical Center in South Bend and St. Mary's Health System in Evansville.
Sagamore's membership had been slipping recently, even as Anthem's was growing. Sagamore has lost 72,000 customers since 2004. Anthem, meanwhile, added more than 250,000 during that time.
"This brings pretty big penetration for Cigna," said Abel of Blue & Co. "Hopefully, it makes the marketplace more competitive. But only time will tell."