TL/DR –
Humana has established a new joint venture with BlackRock to operate roughly 150 of its senior primary care clinics, superseding an existing partnership with another investment firm. The deal, set to close by the end of the year, sees BlackRock purchasing the existing ownership stake in the clinics from private equity firm Welsh, Carson, Anderson & Stowe, valued at $2.8 billion. Humana states that the venture will reduce liabilities on its balance sheet and provide extra capital to support the growth of CenterWell, which will remain a minority owner and continue to manage the clinics without any changes to patient care.
Humana and BlackRock’s $2.8 Billion Joint Venture
Insurance giant Humana has entered a new joint venture with BlackRock, involving around 150 of its senior primary care clinics. Replacing a prior arrangement with a different financial institution, this move sees BlackRock purchasing the ownership stake in these clinics from private equity firm Welsh, Carson, Anderson & Stowe. The stake, valued at $2.8 billion, will see CenterWell continue managing these clinics with no changes in patient care.
Expected to conclude by the year-end, this venture will improve Humana’s balance sheet by reducing liabilities and releasing additional capital to promote CenterWell’s expansion.
Humana’s Commitment to Primary Care Delivery
In recent years, Humana has prioritized primary care delivery, seeking to diversify its revenue. It has grown CenterWell through investments and acquisitions, resulting in more than 350 senior primary care locations under CenterWell Senior Primary Care and Conviva Senior Primary Care.
By leveraging BlackRock’s extensive resources, Humana plans to further CenterWell’s growth, including new clinic establishments and acquisitions. BlackRock will gain a majority stake in approximately 150 CenterWell clinics, previously backed by WCAS.
The previous joint ventures with WCAS were crucial in expanding CenterWell into the nation’s leading provider of senior-focused value-based primary care. The new arrangement with BlackRock, however, offers Humana more financial and operational flexibility.
Humana anticipates a significant decrease in balance sheet liabilities due to the elimination of a put option, which would force Humana to repurchase their equity stake in the clinics at a fixed price. CenterWell now has the option to purchase clinics from the joint venture starting 2028. If CenterWell hasn’t bought all the clinics by 2033, BlackRock can exit by selling the remaining clinics, with CenterWell having the right to submit the first offer.
This joint venture is expected to significantly lower capital costs, according to Humana. Despite the venture, Humana maintains that its 2026 earnings forecast will remain unaffected.
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