Dive Brief:
- Transcarent, a healthcare platform for self-insured employers, has agreed to acquire the majority of on-demand virtual care platform 98point6, including its almost 100-clinician physician group, in a deal worth up to $100 million.
- Transcarent will get 98point6’s self-insured employer business, affiliated physician group and a software license, while the remaining 98point6 will rebrand as 98point6 Technologies and focus on licensing its software to third-party providers.
- Seattle-based 98point6 bills itself as an artificial intelligence-enabled chatbot that collects patient information and summarizes it for a physician, who continues the conversation. The transaction is expected to close by the end of March.
Dive Insight:
Healthcare entrepreneur Glen Tullman started Transcarent three years ago in a bid to take on rising costs in the self-insured employer market by creating a one-stop shop for employees’ healthcare needs, including in-person and virtual care.
Transcarent most recently raised a $200 million Series C round at a $1.6 billion valuation last January. Interest in the company has likely been helped by Tullman’s track record as a startup CEO. Tullman has taken three companies public, including EHR vendor Allscripts and chronic care management company Livongo, which then sold to Teladoc for $18.5 billion in 2020.
Transcarent was attracted to 98point6 because of its physician group and artificial intelligence capabilities, Tullman said in a release on the deal.
The purchase price of 98point6 at roughly $100 million includes cash and equity, and is dependent on certain performance targets being met, according to a Transcarent spokesperson.
Transcarent’s acquisition of 98point6’s technology and affiliated provider group will complement its in-house capabilities and partnerships with providers for both in-person and virtual care, to create a more personalized experience for members, the release said.
After the deal closes, Transcarent members will have the choice to opt into 98point6’s text-based platform, including on-demand access to primary care, with the ability to get additional specialty care at home or in local communities from Transcarent’s provider partners.
By nabbing 98point6, Transcarent is bringing onboard hundreds of self-insured employers, including Boeing and Banner Aetna, an affiliate of CVS-owned payer Aetna and Arizona-based health system Banner Health.
The transaction will also bolster Transcarent’s relationships with some of the biggest payers in the U.S. that are already using 98point6 — like Aetna — giving it a chance to fold its other services into their plans.
It’s Transcarent’s second acquisition to date. In late 2020, Transcarent announced it would acquire Bridge Health, a startup providing surgical advocacy and centers of excellence programs for self-insured employers.
