Value-based primary care network Oak Street Health acquired RubiconMD for $130m, adding virtual specialty care to its existing services focused on seniors in the Medicare Advantage population.
- Oak Street operates by initiating full-risk contracts with Medicare Advantage plans, taking on complete economic responsibility for patients in exchange for per-member, per-month compensation. Oak Street Health currently operates over 100 centers across 18 states and is the only primary care provider endorsed by the AARP.
- RubiconMD’s network contains over 230 specialists across all major specialties, with a virtual platform that provides clinical insights on specific patient cases and allows primary care providers to directly manage more of a patient’s care needs.
- Integrating specialty care into Oak Street’s value-based model will enable it to improve coordination between PCPs and specialists while streamlining operations, an important component to successfully managing a full-risk model.
RubiconMD was built to support the exact type of health centers managed by Oak Street, and the acquisition provides Oak Street with a proven platform and a large specialist network instead of having to develop both from scratch.
Although Oak Street was an early entrant in the value-based care segment, the RubiconMD acquisition highlights the scale needed to compete for contracts with a limited pool of employers and payors, likely foreshadowing more consolidation on the horizon.