R1 buys Intermedix in merger of revenue cycle vendors
Two major revenue cycle management vendors are combining in a deal that will offer enhanced technology and outsourced emergency department and ambulance billing services to hospitals.
In a deal valued at $460 million, R1 RCM is buying Intermedix, which offers practice management systems and emergency billing services along with a robust data analytics platform.
“R1 is an impressive outlet making noise lately,” says John Osberg, a merger and acquisitions specialist at Informed Partners, a consulting firm. For example, R1 is the revenue cycle partner for Ascension, one of the largest healthcare delivery systems with 141 hospitals, 2,500 sites and 36,000 providers. Much of R1’s revenue cycle work is done off-shore in India.
Joseph Flanagan, President and CEO at R1, says the next chapter in healthcare is one of revenue cycle transformation where an enterprise-wide approach will simplify and contribute to the way patients interact with the revenue cycle. “By integrating the Intermedix assets into our technology-enabled services, we believe our health system and physician practice partners will more easily connect revenue cycle operations across all points of care, improving the patient and physician experience while improving revenues and reducing costs.”
With the breadth of Intermedix’s presence in emergency departments, R1 now will have hundreds, if not thousands, of new customers when the acquisition closes, according to Osberg. “This is all about the emergency departments in hospitals,” he adds. “The combination of the two companies could become a best-of-breed emergency department revenue cycle company. Intermedix focuses on ambulance and emergency billing and does it better than anyone else.”
Joel Portice, CEO at Intermedix, says joining R1 is a natural evolution for the company as clients will gain a deeper breadth of services that will better connect them to hospitals and health systems.
The bottom line for Intermedix, according to Osberg, is that it gets access to major delivery systems to cross-sell services.