Virgin Pulse, a digital health navigation company for employers, said on Wednesday its merger with third-party health plan administrator HealthComp has closed.
The combined company's value is $3 billion, according to the two companies. Specific terms of the deal were not disclosed.
Private equity firms New Mountain Capital and Marlin Equity Partners first announced plans to merge the companies in September. New Mountain Capital is the majority owner of the new company while Marlin Equity Partners will maintain minority ownership. Morgan Health, a JPMorgan Chase company focused on employer-sponsored healthcare, and Blackstone, a private equity firm, are also financially backing the combined entity.
Virgin Pulse CEO Chris Michalak, who will serve as the combined entity’s CEO, said the companies will begin selling its integrated offering by 2024. The two companies will aim to create a platform for self-insured employers that helps employees navigate and use health benefits.
“Employers would never free up every employee to go buy paperclips, paper, pens and so forth…but in healthcare, that's what we do,” Michalak said. “Nobody has done a great job of linking all those elements together.”
Virgin Pulse anticipates the combined platform will allow self-insured employers to select benefits that employees want, while driving down costs with concierge-level claims administration, medical cost management and clinical navigation. Together, the companies say they serve 20 million people and more than 1,000 self-insured employers.
Michalak said the first steps in bringing the company’s offering to market is streamlining user experience and tailoring its pitch to employers. He said previous offerings from each company will continue to be available for customers.
The deal’s close will lead to some roles being eliminated, but Michalak didn't specify how many people would be affected.