Healthcare mergers and acquisitions are in no short supply as providers, health tech companies, payers and other industry players look to expand their businesses and gain a competitive edge. Here’s a roundup of new deals that were revealed, closed, rumored or called off during the month of January.
Provider
Spectrum Health and Beaumont Health announced Jan. 31 that their planned merger has passed regulatory review and is official as of Feb. 1. The new 22-hospital entity, temporarily named BHSH Health, is now the largest health system and private employer in the state of Michigan.
NorthShore University HealthSystem and Edward-Elmhurst Health wrapped up plans to merge under a nine-hospital parent entity, creating the third-largest health system in the state of Illinois. The organization, temporarily named NorthShore – Edward-Elmhurst, is expected to see total revenues of more than $5 billion during its first year.
HCA Healthcare acquired MD Now Urgent Care for an undisclosed sum. The company was the largest provider of urgent care services in the state of Florida, adding 59 centers to the hospital chain for a new total of over 170 across 19 markets.
DaVita has acquired transplant software company MedSleuth for an undisclosed sum. The kidney care provider said MedSleuth’s technology will not directly integrate with its clinics, which don’t offer transplants but will instead play a role in supporting kidney care patients throughout their care journey.
Vera Whole Health has agreed to purchase and merge with healthcare data company Castlight Health in a $370 million all-cash deal expected to close in the first quarter. The advanced primary care provider is paying Castlight $2.05 per share of the company and will integrate Castlight’s digital platform to support its provider network.
Capital Health and St. Francis Medical Center have signed a definitive agreement to move forward with a deal for the latter to join the two-hospital system. The deal will yield an integrated nonprofit system reaching into the greater Trenton, New Jersey, area. The agreement will now need to move through state and federal regulatory review.
Payer
Centene Corporation completed its $2.2 billion acquisition of Magellan Health a year to the day after announcing its purchase plans. The combination will create one of the country's largest behavioral health platforms, including 41 million unique members. Magellan will operate independently as part of Centene's Health Care Enterprises arm, and members of the existing leadership team, including CEO Ken Fasola, will continue to lead the company within Centene.
Change Healthcare is reported to be mulling a sale of its payment integrity business to smooth over the path to approval for its UnitedHealth Group merger. That business unit, ClaimsXten, generates between $130 million and $150 million in annual earnings and could fetch up to $1 billion for the company.
Tech
R1 RCM plans to acquire Cloudmed in an all-stock transaction valuing the provider software company at roughly $4.1 billion. R1 leadership said the deal will accelerate the revenue cycle management company’s strategy to build the most scalable, flexible and integrated platform for the revenue cycle and consumer engagement in healthcare.
IBM reached a deal to sell the healthcare data and analytics assets from its Watson Health business to investment firm Francisco Partners. Those assets include extensive and diverse data sets and products, including Health Insights, MarketScan, Clinical Development, Social Program Management, Micromedex and imaging software offerings. The companies did not disclose the financial terms of the deal, although previous reports outlined a price in the $1 billion range.
Akili Interactive, the maker of prescription digital therapeutics for pediatric ADHD, announced plans to go public via a special purpose acquisition company merger. Akili said it expects to reach a total equity value of roughly $1 billion. The deal is expected to be finalized during mid-2022.
Symplr, a provider of cloud-based data management solutions, is teed up to purchase Conduent’s Midas Suite of Solutions in a $340 million all-cash deal set to close in the first quarter of 2022. The suite comprises patient safety, quality and advanced analytics solutions, including DataVision and Statit that are used by 2,200 healthcare facilities. In 2020, it generated $72 million in revenue.
Babylon Health kicked off the month by acquiring Higi Health, the maker of biometric self-screen health stations located across retail pharmacies and similar locations. The digital health unicorn had invested in Higi during 2020 and at the time acquired an option to purchase the kiosk maker outright. Terms of the current deal were not disclosed.
Babylon then went on to acquire DayToDay Health, a care management platform that supports patients preparing for and recovering from surgeries, for an undisclosed sum. Babylon said it would integrate DayToDay’s offerings into its digital platform, powering its strategy of reducing burdens on patients and healthcare systems through proactive care.
Aledade notched its first tuck-in acquisition with the purchase of Iris Healthcare for an undisclosed sum. Aledade, which uses data analytics software to help independent doctors’ offices transition to value-based models, will fold Iris’ advance care planning technology into a new health services unit, called Aledade Care Solutions.
Headspace Health has acquired mental health and wellness technology company Sayana for an undisclosed sum. The deal will expand the mental health company’s ability to provide personalized self-care content to its 100 million users, Headspace executives said.
Aetion, a provider of real-world evidence and analytics for life sciences, payers, pharma and regulators, is acquiring fellow data and AI firm Replica Analytics for an undisclosed sum.
WebPT, maker of a software platform for outpatient physical rehabilitation practice management, acquired Clinicient and its subsidiary Keet for an undisclosed sum. The deal, effective Jan. 18, will allow WebPT to scale its services while continuing to support Clinicent’s health record, billing and business intelligence products for outpatient rehabilitation therapy practices, executives said. Together the companies reach more than 27,000 clinics and 43 million patients.
Glooko, a digital diabetes and chronic condition management company, announced the acquisition of diabetes care tool maker xbird. Glooko plans to integrate xbird’s monitoring software into its platform to expand analytics capabilities.
National Medical Billing Services, a revenue cycle management company for the ambulatory surgery center (ASC) market, has acquired ASC medical coding company mdStrategies for an undisclosed sum. The deal will bolster National Medical’s ASC coding expertise and open the door to coding-related point solution offerings for its ASC clients.
Circulo Health, an insurance startup for those covered under Medicaid, has reportedly acquired primary care provider Huddle Health for an unspecified sum.
Miscellaneous
Thomas Park Investments, Chevy Chase and Artemis Real Estate Partners have announced a joint venture with the goal of acquiring a $500 million portfolio of healthcare real estate. The group already made their first purchase, a $40 million acquisition of medical office real estate across three buildings in Maryland and New Jersey.
The Association of American Medical Colleges and the Association of Academic Health Centers announced a merger that will see both nonprofit organizations come under the former’s banner. The deal is slated to close April 1 and will include the Association of Academic Health Centers International subsidiary.