InnovAge’s conversion to for-profit entity approved

Colorado Attorney General Cynthia Coffman on Friday announced that InnovAge, a nonprofit organization with a variety of senior-care operations across Colorado, has been approved to convert to a for-profit entity.

Denver-based InnovAge runs InnovAge Greater Colorado PACE facilities in Loveland and Estes Park that are aimed at providing health-care and day programs for seniors to help them remain and live independently in their own communities. InnovAge also runs a Home Care center in Loveland that provides in-home services and support for seniors.

PACE, or the Program of All-Inclusive Care for the Elderly, is a program through which Medicare or Medicaid-eligible individuals age 55 and over who are at a nursing-home level of care can receive comprehensive medical and social services to help them remain in their homes. A change in federal rules last year allows for-profit entities to become PACE providers.

InnovAge, which also has facilities in California and New Mexico, submitted its notice of intent to convert to a for-profit status to the Attorney General’s office last fall.

According to Coffman’s decision, InnovAge’s conversion comes as part of a capitalization transaction with Welsh, Carson, Anderson & Stowe XII LP. As part of that transaction, InnovAge and its subsidiaries will convert to for-profit status. The InnovAge Foundation, meanwhile, will be restructured. Welsh will pay the foundation $180.3 million plus 5 percent of the shares in the new for-profit entity.

The Foundation will remain as a grant-making, rather than operational, charity that continues to promote affordable and coordinated services for the aging population.

Welsh noted to Coffman its intent to keep the InnovAge headquarters in Colorado for at least five years following the conversion.

“Today’s opinion approving, with considerable modification, InnovAge’s proposal to convert from a nonprofit to a for-profit company is the result of an exhaustive review conducted by my office,” Coffman said in a prepared statement. “This effort is the first of its kind in the nation, and I believe the careful legal and public scrutiny will set the standard for PACE conversions nationwide.”