Cigna Subsidiary Evernorth Acquires Telehealth Vendor MDLive
Evernorth, a subsidiary of health insurer Cigna, has entered into a definitive agreement to acquire MDLive, a privately held virtual care delivery platform. Financial terms of the acquisition were not disclosed.
Cigna and MDLive have been longtime partners and Cigna’s venture arm is an investor of the telehealth company. Last year, the companies announced that Cigna would be the first MDLive partner to offer virtual care for preventive checkups, beginning in the second quarter of 2020. The new primary care virtual offering expanded on the urgent care, behavioral health and dermatology care that MDLive was already providing.
Founded in 2009, MDLive announced a huge funding round of $50 million in September. Like other telehealth companies, MDLive experienced significant growth that has been accelerated by the COVID-19 pandemic. Following five consecutive years of over 45 percent visit growth, in the first half of 2020, MDLive virtual visits increased by more than 95 percent, and total bookings increased by more than 300 percent. Through July, MDLive completed nearly 1 million patient visits with large increases reported across all service lines, company officials announced last fall.
"Customers expect more convenient care interactions, and COVID-19 has rapidly accelerated this need. We see an immediate opportunity to build a new model of care delivery, one that delivers a connected experience with greater affordability, predictability and simplicity. With the opportunity to serve millions more people, and with more personalized ways to deliver care, we will have an even greater impact on our customers, clients and partners," Tim Wentworth, CEO of Evernorth, said in a statement. "Combining MDLIVE's platform and strong network for virtual providers with our comprehensive care solutions, we will be better positioned to optimize the care journey to improve affordability and accessibility, and to deliver superior support to health plans as they advance their own care delivery models for the future."
The transaction is subject to customary closing conditions, and is expected to close in the second quarter of 2021, subject to receipt of required regulatory approvals. Cigna said it continues to expect to deliver 2021 adjusted earnings per share of at least $20 inclusive of the impact of the acquisition of MDLive, and more information will be available on its upcoming Investor Day event scheduled for March 8.
Last September, Cigna announced the launch of Evernorth, a new brand for its growing health services portfolio. Officials at the time said that “Evernorth will accelerate delivery of innovative and flexible solutions to meet the diverse needs of health plans, employers, and government organizations.” They added that the new company will bring together Cigna's various health services capabilities, as well as those of partners from across the healthcare system, in pharmacy solutions, benefits management, care solutions, and data and analytics. They said that Evernorth will aim to coordinate best-in-class services, programs, and partnerships, with the goal to transform them into comprehensive solutions that drive the most value for clients, customers, and patients.
A Forbes article on the acquisition notes that “The deal announced Friday brings in-house a service that until now has largely been something that health insurers have paid for via contract, but Cigna sees MDLive and its round-the-clock telehealth delivery platform as critical to the Evernorth healthcare services.”
"Becoming part of the Evernorth portfolio is an opportunity for MDLive to join an organization that complements our work, and has been a long-time partner and investor in our business," said Charles Jones, Chairman and CEO of MDLive. "Together, we can accelerate MDLIVE's growth strategy and ability to serve more customers, while also building new services that will benefit our existing stakeholders, including employees, partners, patients, customers, health plans and providers…”
