Evolent Health, the Arlington, Va.-based company best known for helping healthcare organizations with strategic population health planning, has made a move to strengthen that cause by acquiring the majority of Valence Health's business for approximately $145 million.
Evolent was founded in 2011 to support providers in moving to a population health model of care delivery and to successfully manage performance-based payment arrangements. The company started with $25 million in funding from The Advisory Board Company and the UPMC Health Plan, and has grown by leaps and bounds on the back of its population health partnering strategy. Last year, Evolent became a publicly traded company. The company was a 2014 Healthcare Informatics Up and Comer and on this year’s Healthcare Informatics 100 list, Evolent ranked 59th.
Valence Health, based in Chicago, was founded in 1996 and provides value-based administration, population health and advisory services. In its 20 year history, Valence Health has carved out a particular niche in the Medicaid and pediatric markets, and today supports approximately 600,000 lives across 10 long-term operating partners.
Together, the organizations will be able to offer comprehensive services and technology across a variety of populations and will serve more than 1.8 million lives across 23 long-term operating partners at closing, comprised of provider-sponsored health plans, accountable care organizations and full-risk entities, officials said in a press release statement.
"By adding Valence Health's services to Evolent, we expect to strengthen our operational capabilities and expertise, expanding our ability to support provider organizations in delivering higher quality, lower cost care," Evolent CEO Frank Williams said in a statement. "Strategically, we have tightly aligned visions of improving healthcare through innovative technology and services that help providers succeed as the industry continues its adoption of value-based payment models.”
Evolent expects the acquired business, on a standalone basis, to generate revenues of approximately $80-85 million for the year ending December 31, 2016; however, Evolent will consolidate the results of the acquired business only for the period subsequent to the close of the transaction. The companies expect the transaction to close within the next 120 days, subject to regulatory approvals and certain closing conditions set forth in the agreement, officials said.
Get the latest information on Health IT and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.