JP Morgan Chase entered into an agreement to acquire healthcare technology company InstaMed. The deal is aimed at beefing up the investment bank's capabilities in the healthcare payments arena.
InstaMed built a patented, private cloud-based platform to link healthcare consumers, providers and payers. Its platform is aimed at streamlining the often confusing world of medical billing and payments.
- JPM announced its acquisition plans for the Philadelphia-based company Friday. The company didn't disclose a target date for the acquisition, but told Healthcare Dive it is pushing to close the deal this year.
Financial services powerhouse JPM wants to make a bigger mark in the healthcare payments game with the InstaMed buy. The corporate giant is known in healthcare services for being one of the three companies to launch Haven, which aims to bring down employee healthcare costs, to great fanfare in January 2018.
The InstaMed deal will expand the global financial services company's wholesale payments business to include a specialized focus on healthcare payments, the company said.
"This acquisition will expand the firm's healthcare payments capabilities, arming the firm with real product differentiation in healthcare payments," the company said. "With InstaMed, we will be able to offer healthcare providers, payers and consumers an end-to-end healthcare payments solution."
Outdated approaches to bill payment, claims processing, collection and reconciliation are frequent obstacles in the healthcare sector. And Instamed's solely digital transaction focus is poised to disrupt the older models and reduce inefficiencies, the company said.
"[T]his acquisition will give use a unique advantage in one of the fastest growing sectors," Takis Georgakopoulos, global head of wholesale payments at JPM, said in a statement. The healthcare segment of the U.S.economy is estimated at $3.5 trillion and it's growing.
InstaMed, founded in 2004, developed its digital healthcare transaction network in-house. Its proprietary digital platform is designed to simplify the end-to-end payment process while keeping the transactions secure.
JP Morgan will be getting a company with about 300 employees. Instamed processed about $94 billion in healthcare payments in 2018.