Nasdaq-listed IT services major Cognizant, which has been on an acquisition spree for past few years, will acquire Health Care Service Corporation’s (HCSC) subsidiary TMG Health for an undisclosed amount. The deal is expected to close in the third quarter of 2017, Cognizant said in a statement. The acquisition will strengthen Cognizant’s business process-as-a-service (BPaaS) offering for the government and public health programme markets, it added.
“TMG Health will (now) enter into a new, expanded multi-year service agreement to continue providing IT, business process and other services to HCSC’s various operating units and subsidiaries,” Cognizant said in a statement.
Cognizant has acquired 16 companies in last six years with eight of these deals happening in the last three years. In March 2017, Cognizant acquired Osaka, Japan-based Brilliant Service Co. Ltd which specialises in digital strategy, product design and engineering, Internet of Things (IoT) and enterprise mobility.
TMG Health, an HCSC subsidiary since 2008, has offices in Pennsylvania and Texas and is a provider of business process services to the ‘Medicare Advantage’, ‘Medicare Part D’ and ‘Managed Medicaid’ markets in the US, supporting 32 client plans and more than 4.3 million members in all 50 states.
Once the deal is closed, TMG Health’s healthcare business and technology professionals will become employees of Cognizant. However, TMG Health will continue to provide information technology, business process and other services to HCSC’s subsidiaries.
The combination of TMG Health’ capabilities and Cognizant’s digital systems and technology practices will strengthen Cognizant’s BPaaS solution which helps insurers manage government lines of business, TMG Health said.
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“Cognizant and TMG Health share similar priorities and values when it comes to helping clients deliver superior member-centric care, enable efficient claims processing,” said Susan Rawlings Molina, president and CEO of TMG Health.
“Government business lines are expanding, and more players are entering the market. There is a growing opportunity for our teams to work together to help clients succeed in regulated, cost- and compliance-driven markets”, Molina added.
Building on Cognizant’s 2014 acquisition of healthcare technology provider TriZetto, the addition of TMG Health will extend its digital solutions for healthcare providers.
“Cognizant’s TriZetto Facets and QNXT healthcare claims and administration software processes more than 30% of the US’ managed Medicare lives and over 60% of the nation’s managed Medicaid lives,” said Kaushik Bhaumik, executive vice president and global head of healthcare at Cognizant.