Fast-growing healthcare technology company Iodine Software has made its second acquisition in less than a month, snapping up its competitor ChartWise Medical Systems.
The company did not disclose financial terms of the deal.
Austin, Texas-based Iodine Software uses artificial intelligence to solve provider problems such as improving clinical documentation. ChartWise Medical Systems also provides clinical documentation improvement solutions for the healthcare market.
The acquisition expands Iodine’s clinical predictions to more than 800 hospitals and health systems, according to company executives.
In late May, Iodine Software announced it had acquired mobile-based physician engagement platform Artifact Health, which helps the software company to get its AI technology directly into the hands of more than 80,000 providers across the country.
Iodine Software built a machine learning approach that significantly improves reliability in clinical documentation to help ensure proper reimbursement for health systems. The company experienced rapid growth over the last decade by applying its ML engine to solve midcycle revenue leakage—a problem that costs healthcare systems billions in lost revenue due to resource-intensive, highly manual clinical documentation workflows.
Prior to the ChartWise acquisition, Iodine worked with 550 hospitals and has helped those organizations recognize $1.5 billion in additional appropriate reimbursement annually, according to executives.
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The acquisition of ChartWise further signals Iodine’s rapidly advancing strategy to expand its ML technology to serve the broader healthcare market.
“ChartWise has been a top performer in addressing the needs of CDI teams for many years. Not only do they open up access for Iodine to a whole new set of hospitals and health systems, they also bring capabilities and new product innovations that will expand our offerings to the clinical documentation teams we serve,” said William Chan, co-founder and CEO of Iodine Software, in a statement.
The deal to bring on ChartWise broadens Iodine's market share, adding hundreds of hospitals across dozens of health systems for a combined reach of more than 800 hospitals across the now combined companies, Chan said.
"ChartWise is particularly well suited to smaller healthcare organizations, whereas the Iodine AwareCDI Suite may not be suitable for the organization's current stage. ChartWise has also established footholds in several global markets where CDI is just taking root, enabling Iodine to now expand overseas where and when it makes sense," he told Fierce Healthcare.
Iodine selected ChartWise for its “Best in KLAS” performance in ensuring clinical documentation integrity, its expanded capabilities—which include an outpatient application—and the overall value it brings to smaller health systems.
On the heels of the Artifact acquisition, Iodine now has the opportunity to cross-sell solutions to an enlarged base of clients, according to Chan.
The combination of capabilities from Iodine, Artifact and ChartWise enables the company to introduce existing AI and ML tools to more healthcare organizations, such as delivering AI/ML and robotic process automation capabilities to smaller organizations that may be able to leverage this type of technology to address existing staffing challenges, Chan said.
"We can Infuse existing products with new AI/ML capabilities, leveraging the AI foundation that Iodine has pioneered to further improve the effectiveness gained by the use of Chartwise's products," he said.
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Performance benchmarking company KLAS Research recently recognized both Iodine and ChartWise as top performing CDI companies.
The enterprise AI space in healthcare is one to watch, with Microsoft's eye-popping $19.7 billion acquisition of speech recognition and healthcare AI company Nuance. Investment dollars for AI startups boomed in 2020 and skyrocketed during the first quarter of 2021, according to CB Insights.
Globally, healthcare AI companies brought in a record-breaking $2.5 billion in the first quarter of 2021 in 111 deals.
“The key to success in the CDI market today is all about product depth and automation across the entire inpatient and outpatient continuum of care. Providers and payers need smart, proven workflow tools to optimize results for CDI specialists, physicians, and quality, HIM, and revenue cycle leaders. Iodine customers now have the benefit of the top three best in breed CDI solutions: Iodine, ChartWise, and Artifact—all under one umbrella,” said Steven J. Mason Jr., president and CEO of ChartWise Medical Systems, in a statement. “We are very enthusiastic about the opportunities this acquisition provides for our collective customers and other leading CDI-driven healthcare organizations.”
The ChartWise team will join Iodine immediately, according to a company press release.
Mason will join Iodine as executive vice president, ChartWise, and will lead the ChartWise platform.