Waystar to Acquire eSolutions in Major Health Care Move

Waystar recently announced its plan to buy eSolutions, a move that will bring commercial and government healthcare payment methods under one company for the first time.

Waystar, one of the leading providers of healthcare payments software, announced Aug. 12 that it would acquire eSolutions.

ESolutions is a revenue cycle technology company with unique Medicare-specific solutions. ESolutions service is designed to maximize revenue collection, accelerate cash flow, and payer connections, and manage billions of transactions.

Waystar is similar to eSolutions in that it uses innovative technology to create greater transparency for health care patients. The company supports more than 450,000 providers, 750 health systems and hospitals, and 5,000 payers and health plans through its cloud-based payment platform.

Bringing the two companies together will significantly further innovation and convenience in the healthcare industry. Executives hope the acquisition will accelerate revenue collection while reducing administrative expenses and repetitive tasks.

“We have long-admired eSolutions for its unique Medicare-specific revenue cycle capabilities, which are a perfect complement to the Waystar platform. We are excited to move forward as one team,” said Waystar CEO Matthew Hawkins.

Once the deal is completed, Waystar hopes to eliminate the need for multiple billing and payment processing systems for hospitals and other healthcare providers. Currently, health care providers often use different programs for commercial and government payers. It will be the first time in the healthcare industry that commercial and government payers will be on the same platform.

According to Hawkins, Waystar was explicitly interested in acquiring eSolutions partly because of its strength in nonacute sectors of health care and its focus on Medicare. The Medicare program is growing with aging baby boomers making it a lucrative market.

“We think it benefits every major participant in health care, including patients,” said Hawkins.

Waystar has integrated several other technologies and services into its cloud-based platform over the years. These include patient estimation and prior authorization technology, a claims monitoring tool, and leveraging predictive analytics to offer an agency manager an advanced propensity to pay.

The Wall Street Journal reports that eSolutions is valued around $1.3 billion, although the amount Waystar will pay for the company has not been released. The deal is said to be roughly 10 times eSolutions’s projected 2020 revenue and 20 times its projected earnings before interest, taxes, depreciation, and amortization.

Waystar is backed primarily by Stockholm-based EQT Partners, who bought Waystar in partnership with Bain Capital last year. ESolutions is backed by technology-focused firm Francisco Partners, which purchased the company in 2015.

“ESolutions is a special company with a laser focus on helping their provider customers get reimbursed for care provided with ease. The company’s growth and innovation during our five-plus years of partnership have been amazing, and we are thrilled that this combination will allow the company to deliver ever greater value to its customers,” said Ezra Perlman, co-president of Francisco Partners.

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