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Portfolio > Alternative Investments > Private Equity

Division To Design Plans For Private Equity Firms

By Staff Writer

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A new operation is setting up health coverage programs for firms that invest in other companies.

The private equity solutions practice at UnitedHealth Group Inc., Minnetonka, Minn., is focusing on selling health coverage to private equity firms that control at least 5 “portfolio companies,” each of which have more than 100 employees.

The ideal clients will be firms with at least $200 million in assets under management that want to cut health coverage costs for the portfolio companies by decreasing administrative expenses, according to practice organizers.

The United States is home to about 4,000 private equity firms, but the private equity practice will cater mainly to bigger firms that specialize in financing buyouts and leveraged buyouts of mature businesses, practice organizers say.

Up till now, practice organizers say, most private equity firm portfolio companies have had to continue to buy their own health coverage, without getting the economies of scale they theoretically might obtain through their association with a larger company.

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