- Centene has signed a definitive agreement to acquire health analytics company Apixio for an undisclosed sum, the payer announced Monday.
- Apixio mines and analyzes patient data using artificial intelligence from sources like physician notes and medical charts to support payers' and providers' administrative functions. With the acquisition, Centene wants to digitize its back-end operations and leverage patient data to improve care, CEO Michael Neidorff said in a statement.
- The deal is expected to close by the end of this year, subject to regulatory approvals.
Healthcare companies are increasingly turning to technology, including AI and machine learning, to streamline administrative functions, with the goal of cutting down on waste and saving money. The buy of San Francisco-based Apixio is meant to complement Centene's existing data analytics products, Neidorff said, while broadening support for value-based healthcare payment.
Apixio will remain an operationally independent business in Centene's Health Care Enterprises segment, and will continue to serve existing clients and sell to the industry at large. The payer currently has five businesses in that division, per its website, including clinical and genomic data analytics company Interpreta.
Apixio was founded in 2009 and has raised more than $50 million across eight rounds of funding. In September, the private company announced it expected revenue this year to grow by 50% compared to 2019, amid rising demand for data analytics from payers managing government-sponsored health plans.
Centene, the largest Medicaid managed care organization and largest provider of plans in the ACA marketplace in the U.S., reported a profit of $568 million in the third quarter. That's almost six times higher than its net earnings in the third quarter of 2019. Membership and revenue also grew, as lower utilization of medical services was partially offset by higher testing and treatment costs for COVID-19.
Although payers have generally profited handsomely this year, they have also faced unprecedented volatility amid the pandemic, a contentious political environment and a Republican state-led lawsuit to overturn the Affordable Care Act. The Supreme Court is slated to hear arguments on the high-profile case Tuesday.