The New York City-based healthcare financial advisor outlined three M&A trends present in the payer arena under payment shifts like the Medicare Access CHIP and Reauthorization Act.
1. Payers are adapting to value-based care payment models by offering customized solutions to record and track patient outcomes. Brocair Partners said several acquisitions undertaken by Centene Corp., a St. Louis-based managed care health plan, reflect the industry’s adaptation to regulatory changes. Centene acquired Health Net, a Woodland Hills, Calif.-based managed care organization specializing in government-sponsored policies, for $6.8 billion
“This acquisition makes Centene the largest managed care organization in the U.S. Now, they can leverage their scale to offer consumers higher quality care at a lower price point,” Brocair Partners notes.
2. Larger and middle-market insurers serving high-risk populations are pursuing transactions that add market share and scale to competitively price plans. For example, Columbia, Md.-based Magellan Health acquired Senior Whole Health in Cambridge, Mass. Senior Whole Health operates a policy for complex, elderly and high-risk populations.
3. The prevalence of data and automation are driving payer consolidation outside the U.S. Payers are increasingly interested “in gaining exposure to different international systems facing similar challenges,” Brocair Partners said. To illustrate this trend, they noted IMS Health Holdings’, a health IT company based in Danbury, Conn., acquisition of French health insurance software company Cegedim for $523 million.
More articles on payer issues:
Anthem expands ACA exchange pullback to 9th state, cuts Kentucky participation in half
Study: Narrow network plans sold on ACA exchanges 16% cheaper than broad network plans
Evergreen Health to be liquidated: 5 things to know
