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Premier, Inc.';s Subsidiary Contigo Health, LLC, Completes Asset Transaction for National Provider Contracts and Licenses to Cost Containment Technology
Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Neutral)
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Rhea-AI Summary
Premier, Inc. (NASDAQ: PINC) announced that its subsidiary, Contigo Health, has finalized the acquisition of assets from TRPN Direct Pay and Devon Health. These assets include contracts with over 900,000 providers across 4.1 million locations in the U.S. The new product, Contigo Health® ConfigureNet™, aims to enhance health plan offerings while reducing costs through pre-negotiated discounts. The transaction is projected to contribute $40 million to $60 million in annual net revenue and add $0.01 to $0.02 to earnings per share in fiscal 2023.
Positive
Acquisition of contracts with over 900,000 providers enhances network access.
Expected annual revenue increase of $40 million to $60 million.
Projected earnings per share growth of $0.01 to $0.02 for fiscal 2023.
Launch of new product, Contigo Health® ConfigureNet™, to improve healthcare access.
Negative
None.
New assets will support Contigo Health’s continued growth by expanding its nationwide footprint and enhancing the value proposition for direct-to-employer offerings
CHARLOTTE, N.C.--(BUSINESS WIRE)--
Premier, Inc. (NASDAQ: PINC) subsidiary Contigo Health, LLC, a provider of comprehensive services that optimize employee health benefits, today closed its transaction to acquire key assets from TRPN Direct Pay, Inc. and Devon Health, Inc. (collectively, TRPN). Acquired assets will include contracts with more than 900,000 providers across 4.1 million U.S. locations, as well as licenses to TRPN’s proprietary cost containment technology.
Contigo Health, which collaborates directly with self-funded employer health plans and health systems to improve employee access to high-quality healthcare, plans to leverage the acquired assets to develop the provider contracts into a new out-of-network wrap product named Contigo Health® ConfigureNet™. This new product is expected to complement and help grow Contigo Health’s health plan administration products, improving access to quality healthcare and reducing the cost of medical claims through pre-negotiated discounts with its network providers. Claims will be aligned to the network provider’s contracted rate through an electronic data interchange to help ensure a rapid and seamless process for health plans and providers alike.
Premier currently anticipates the transaction to generate adjusted earnings per share accretion of $0.01 to $0.02 in fiscal 2023. In addition, the company expects the transaction to result in $40 million to $60 million in incremental annual net revenue and contribute 40 percent to 50 percent in adjusted EBITDA margin once fully scaled in the next three to five years.
“We are pleased to complete this transaction and look forward to the launch of Contigo Health® ConfigureNet™ later this fall,” said Michael J. Alkire, President and CEO of Premier. “With the acquisition of these assets, Contigo Health is well positioned to expand into self-funded employer health plans across the country, offering a differentiated solution that better manages costs and offers more choices to employees.”
Forward-looking statements
Statements made in this release that are not statements of historical or current facts, such as those related to Contigo Health, LLC’s ability to expand its product offerings and offer increased access to high-quality care and improved employee engagement, the additional expected benefits of the transaction including increased provider access, better management of out-of-network claims and increased flexibility to employers, and the expected benefit to Premier’s revenue and adjusted fully diluted earnings per share in fiscal year 2023 are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Premier to be materially different from historical results or from any future results or projections expressed or implied by such forward-looking statements. Accordingly, readers should not place undue reliance on any forward-looking statements. In addition to statements that explicitly describe such risks and uncertainties, readers are urged to consider statements in the conditional or future tenses or that include terms such as “believes,” “belief,” “expects,” “estimates,” “intends,” “anticipates” or “plans” to be uncertain and forward-looking. Forward-looking statements may include comments as to Premier’s beliefs and expectations as to future events and trends affecting its business and are necessarily subject to uncertainties, many of which are outside Premier’s control. More information on potential factors that could affect Premier’s financial results is included from time to time in the “Cautionary Note Regarding Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of Premier’s periodic and current filings with the SEC. Forward-looking statements speak only as of the date they are made, and Premier undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events that occur after that date, or otherwise.
About Premier, Inc.
Premier, Inc. (NASDAQ: PINC) is a leading healthcare improvement company, uniting an alliance of more than 4,400 U.S. hospitals and health systems and approximately 250,000 other providers and organizations to transform healthcare. With integrated data and analytics, collaboratives, supply chain solutions, and consulting and other services, Premier enables better care and outcomes at a lower cost. Premier plays a critical role in the rapidly evolving healthcare industry, collaborating with members to co-develop long-term innovations that reinvent and improve the way care is delivered to patients nationwide. Headquartered in Charlotte, N.C., Premier is passionate about transforming American healthcare. Please visit Premier’s news and investor sites on www.premierinc.com; as well as Twitter, Facebook, LinkedIn, YouTube, Instagram and Premier’s blog for more information about the company.
About Contigo Health, LLC
Contigo Health, LLC, a subsidiary of Premier, Inc., creates new ways for clinicians, health systems and employers to work together to optimize employee health benefits. With over 3.9 million eligible members, Contigo Health® products include Sync Health Plan Administration TPA, Sync Health Plan BPO, and ECEN Passport (COE). These quality programs support a common goal for all stakeholders to increase access to high-quality care, enhance employee engagement, control costs and get employees back to work and life faster. For more information, please visit www.contigohealth.com as well as LinkedIn, YouTube and Twitter.
