In a deal that will add feet-on-the-ground management of payer reimbursement services to 200 hospitals in 30 states enabled by a technology backbone, Emdeon Inc. announced in early September that it will acquire Altanta-based Chamberlin Emonds & Associates for $260 million in cash.
For the six months ended June 30, Chamberlin Edmonds reported approximately $43 million of revenue.
With the acquisition, Emdeon picks up a technology-enabled services company that specializes in lowering the incidence of uncompensated care while further strengthening its core revenue cycle suite of products and services.
“This is the premier Medicaid eligibility and enrollment asset that is provider-focused in this space,” said Frank Manzella senior vice president of corporate development with Emdeon. “That fits well alongside our commercial and government eligibility tool. So we are already in this space on a commercial and technological basis and this puts a service component focused on government payers right on top of that.”
With Chamberlin Edmonds, Emdeon gains a company with 24 years of patient advocacy, guiding uninsured patients through the complex processes associated with securing reimbursement from Medicaid, Social Security Disability, state disability, charity care and other community benefit programs. Chamberlin Edmonds' service model includes staff on site at client hospitals that collaborate closely with the hospital's revenue cycle team.
The acquisition comes as healthcare reform is projected to swell the ranks of people eligible for coverage under Medicaid. According to the Congressional Budget Office, Medicaid rolls are expected to increase from 39 million today to 55 million eligible people by 2014.
"As government programs continue to expand under healthcare reform, hospitals will need better tools to lower the rate of uncompensated care and increase cash flows,” said George Lazenby, Emdeon's CEO. “The combined company will be able to offer enhanced revenue cycle services designed to help providers navigate the complex systems related to government reimbursement."
To support its on-site healthcare representatives, Chamberlin Edmonds utilizes its regional resolution centers and centralized back-office infrastructure to deliver eligibility services from initial patient referral through the post-application resolution process.
"Chamberlin Edmonds has created a scalable technology-enabled service delivery platform that blends national reach and perspective with local delivery and knowledge," said T. Ulrich Brechbuhl, president and CEO of Chamberlin Edmonds. "By joining Emdeon, we are significantly better positioned to offer the full suite of tools, technologies, services and expertise required to build an optimized eligibility process, from screening through enrollment and cash recovery, to hospitals nationwide."
While Emdeon was interested in picking up what it perceived as the industry leader in providing revenue cycle services, the company also saw opportunity for improving the efficiency of the technology-based support structure used by Charmberlin Edmonds’ workers in the field.
“Our eligibility tool is a technology tool, so hospitals will use our tool to ping databases and get answers,” explained Manzella. “We’ve been in this business for a while, but not on a services basis. Chamberlin Edmonds brings us in on a government services basis and that circles back on itself, because our technology tool can be used to help make their process more efficient. So instead of having a person making a phone call, you can use some of our technology tools to get that information, as well.”
In addition to improving efficiency, Emdeon also anticipates being able to bring the Chamberlin Edmonds services to a range of its more than 5,000 hospital customers across the country.
