Emdeon Acquires Change Healthcare For $185 Million
By Christine Kern, contributing writer
Acquisition adds healthcare engagement and value-based healthcare capabilities to EmDeon’s holdings.
Emdeon, a revenue/payment cycle management and clinical information exchange vendor, has announced the planned acquisition of Change Healthcare, a consumer education, transparency, and engagement developer, according to a press release.
The terms of the acquisition deal include approximately $135 million in cash payable at closing, plus additional contingent payments of up to $50 million based upon the attainment of financial performance objectives of the acquired business through the end of 2017. The acquisition is subject to customary closing conditions and is expected to close later this month.
The acquisition will broaden the scope of Emdeon’s offerings, according to the release. “Change Healthcare will enable Emdeon to offer its customers additional solutions that marry cost and quality information with a robust inventory of consumer behavioral insights.” Further, “these insights can help employees, health plan members, and patients reduce costs and become better healthcare consumers.”
“Our customers are prioritizing information, insights, and capabilities that enable individuals to be better healthcare consumers,” said Neil de Crescenzo, Emdeon president and CEO in the release. “While Emdeon has assisted payers, providers, pharmacies, and our partner network with cost management, efficiency, and maximizing revenues for many years, the addition of Change Healthcare's innovative, proven capabilities will further accelerate our customers' success. By combining our connectivity and scale with Change Healthcare's transparency and personalization capabilities, we can help our customers further increase member and patient engagement and add even more value to the services they provide their customers.”
According to The Tennessean, Change Healthcare burgeoned to than 80 employees since its creation in 2007. The sale to Emdeon means further growth and, as a result, more jobs for both Change Healthcare and for Emdeon.
The team at Change Healthcare will join Emdeon and form the core of the company's healthcare consumer engagement business. The business will be led by Change Healthcare's president and CEO, Doug Ghertner, who will report directly to Emdeon's CEO.
According to the Nashville Business Journal, this is Emdeon's second major acquisition this year, following the purchase of California-based Capario in June for $115 million. Emdeon is the fourth-largest private company in Nashville, with $1.2 billion in 2013 revenue and 880 local employees, according to Nashville Business Journal research.
Nashville Business Journal research also reveals that Emdeon and Change Healthcare are ranked second with 305 IT employees and eighth 45 IT employees (out of a total local workforce of 70) respectively of all Nashville healthcare IT companies.