The Obama Administration's health-insurance expansion bill, passed by Congress last spring, has been followed by a flood of private investments into the medical-records and cost-control businesses.
Buyout giants BC Partners, of London, and Silver Lake Partners, of Menlo Park, Calif., bought New York-based MultiPlan Inc., which says it processes claims for insurers, 5,000 hospitals, and over 600,000 doctors and other practitioners. It was purchased last week from Carlyle Group and Welsh, Carson, Anderson & Stowe for $3.1 billion, more than double what they paid for MultiPlan in 2006.
Accolade Inc., a Plymouth Meeting-based management service that gets paid to help companies spend less on employee health care, told the Securities and Exchange Commission it raised $17 million from investors last month, plus $4 million back in January.
Accolade is run by former Accenture executive Thomas Spann, with a team of more than a dozen managers who include veterans of health-insurers WellPoint, United Health, Cigna and Anthem Blue Cross.
Spann's well-connected board, which represents Accenture's investors, includes former Tennessee Sen. William Frist and former Aetna chief executive John Rowe (both of whom are physicians) and Michael Yang, Comcast Interactive Capital managing director. Two partners at New York-based Accretive L.L.C., which founded Accolade, are also on the board. (Accretive also started the Fandango movie-ticketing service, and sold it to Comcast in 2007.) Spann didn't return calls.
L.L.R. Partners, a Philadelphia-based investment firm with $1.4 billion in assets and backed by investor Ira Lubert and his partners, said Tuesday that it invested more than $35 million in Wisconsin-based IOD Inc. That company sells scanning and imaging, EMR conversion, and other critical information services to hospitals and medical clinics, according to L.L.R.
IOD claims over 1,800 hospitals and clinics as customers, selling "end-to-end" scanning, imaging, storage, release, and conversion data systems to medical health-information management departments.
Essent Guaranty, a Radnor-based home-mortgage insurer that hopes to exploit its competitors' troubles as foreclosures from existing loans soar, has issued its first policies and raised another $100 million in capital "from new and current investors," according to chief executive Mark Casale. All of this is happening since Fannie Mae and Freddie Mac agreed to accept Essent insurance on their loans in February.
Casale used to work for Philadelphia-based Radian Inc., which like other mortgage insurers has suffered stiff losses as more families and investors have defaulted on their mortgages.
Essent said in 2009 it had raised $500 million for new home-loan insurance from Pine Brook Road Partners, Goldman Sachs, JPMorgan Chase & Co., PartnerRe, RenaissanceRe Ventures Ltd., and unnamed investors. The firm now employs 40 in Radnor and another 75 at its Winston-Salem, N.C., office, doing business in part through its two-month-old online portal.
Essent "will continue to hire as the business grows," spokeswoman Janice Walker told me.
Bill Covaleski, brewmaster at Victory Brewing Co., Downingtown, says he has recruited both U.S. Reps. Jim Gerlach (R., Chester) and Allyson Y. Schwartz (D. Montgomery) to back the brewery tax cut I wrote about Tuesday.
I asked, in that column, if this will really create net new jobs, as sponsors hope. Says Covaleski: "Our full-time brewery employees have grown from two [at Victory's 1996 founding] to 37 today," plus over 130 mostly part-timers at the adjoining restaurant.
He acknowledges that the growth of Victory, by itself, hasn't compensated for "the 1,400 jobs [Budweiser maker] AmBev shed in St. Louis last year, but it's a start."
Victory is still growing: "We have eight new fermenters arriving Aug. 3-4 that will boost our production capacity past 67,000 annual barrels to over 100,000 annual barrels."