Portico has spent nearly a decade developing technology that manages healthcare provider contracts and financial arrangements for insurance companies.
(click image for larger view)
Slideshow: 12 Advances In Medical Robotics
Health information technology company McKesson Corp. announced Wednesday that it has signed a deal to acquire Portico Systems for a reported $90 million in cash.
The acquisition will boost McKesson's capabilities as a provider of financial management tools at a time when the healthcare industry is transforming its payment systems to meet new requirements under the 2010 health reform law. In particular, McKesson said it's positioning itself to offer tools to accountable care organizations (ACOs) that are required to provide value-based payment systems.
"The ability to create new products that use value-based reimbursement to align payers and providers on achieving the right outcomes is a key strategic imperative," Emad Rizk, president of McKesson Health Solutions, said in a statement. "Portico will further enhance McKesson's ability to help organizations efficiently navigate and manage increasingly complex delivery systems."
According to Janice Young, program director, payer IT strategies at IDC Health Insights, Portico has spent nearly a decade developing technology that manages healthcare provider contracts and financial arrangements for insurance companies. She said the company's technology addresses payment models and information management schemes that provide information between providers and health plans, and a lot of their contracting and financial methodologies have been built specifically to support ACOs.
"Their suite of capabilities is very consistent with the emerging ACO model and there are also great linkage points between financial payments and clinical performance," Young said. "When you bring that into the McKesson environment where McKesson has a large investment in services and solutions around clinical performance, as well as the RelayHealth online physician-patient clinical communication platform, you have a more comprehensive solution that puts McKesson in a better competitive position," Young said in an interview with InformationWeek Healthcare .
McKesson, which bought RelayHealth in 2006, has been steadily investing in technology to manage provider networks and provides applications to support clients in point of care evidence-based decision making; care management; medical and payment policy automation; claims auditing; and fraud, waste, and abuse programs. With the acquisition of Portico, McKesson officials say they will add integrated provider management and value-based reimbursement products to their portfolio to help automate network management, provider enrollment, credentialing, contracting, and pricing.
Officials at Portico, a privately held company that has 33 payer and provider clients serving 42 million members annually, said the addition of Portico's employees will deepen McKesson's expertise in network management and value-based reimbursement.
Ned Moore, Portico Systems' chairman, CEO and co-founder said: "We believe that McKesson's commitment to invest in integrated provider management solutions will help us to continually innovate to better support our customer's evolving needs."
Safeguard Scientifics Inc., which holds a significant stake in Portico, released the financial details of the agreed sale price of $90 million and also said McKesson will pay Portico $5 million on achievement of performance milestones. Safeguard Scientifics will receive $38 million for its stake in Portico. The acquisition is expected to close within 45 days, pending regulatory approval.
The Healthcare IT Leadership Forum is a day-long venue where senior IT leaders in healthcare come together to discuss how they're using technology to improve clinical care. It happens in New York City on July 12. Find out more.
How Enterprises Are Attacking the IT Security EnterpriseTo learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
2017 State of IT ReportIn today's technology-driven world, "innovation" has become a basic expectation. IT leaders are tasked with making technical magic, improving customer experience, and boosting the bottom line -- yet often without any increase to the IT budget. How are organizations striking the balance between new initiatives and cost control? Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.