West Des Moines-based Telligen Inc. announced today that it has acquired a majority of the Medicare quality and case review contracts held by the Colorado Foundation for Medical Care. The deal reflects the regionalization of contracts with these types of health management organizations known as quality improvement organizations, or QIOs, by the Centers for Medicare and Medicaid Services.


In addition to taking over the Colorado contracts, which represent about $8 million in annualized revenue, Telligen will absorb a majority of CFMC's' Denver-based staff - about 100 people - who will continue their work on those contracts, Telligen CEO Jeff Chungath said. Financial terms of the acquisition were not disclosed.


The acquisition, which is the first in Telligen's history, deepens the organization's expertise and enhances its ability to bid for additional contracts, Chungath said.


"It's been a learning experience for the organization, for sure," he said. "So far it's been good."


Telligen, which employs about 525 people and has offices in six states, currently holds QIO contracts with Medicare for Iowa and Illinois, and with the acquisition adds Colorado as a third Medicare QIO contract. Telligen will seek to expand work in its new Denver office, it said.


On the Medicaid side, Telligen has population health management contracts with Iowa, Minnesota, Nebraska and Oklahoma, and is also involved in 16 national health quality initiatives.


Beginning in August, the Centers for Medicare & Medicaid Services will no longer award QIO contracts to single states. Instead, organizations will be awarded contracts to serve regions consisting of three to six states.


Telligen has submitted a proposal to continue serving in the QIO role - working with hospitals, nursing homes, physicians and other health care providers to improve patient care - as a regional partner. Contract awards are expected to be announced later this month.


Telligen, which until 2011 was known as the Iowa Foundation for Medical Care, last year restructured as an employee-owned company. The West Des Moines-based organization was originally founded by physicians as a peer review organization. However, over the past four decades, the organization's mission of improving health care quality and reducing costs has broadened significantly.