Time & Attendance
By Rick Bell
Nov. 3, 2014
Apparently the torrid financial growth and unique industry position of health care benefits software firm bswift didn’t go unnoticed by the industry’s big players.
Insurance giant Aetna Inc. on Nov. 3 announced it is gobbling up Chicago-based bswift, which last spring was rewarded $51 million in private equity money after posting annual growth of 40 percent over the past four years. Aetna will pay $400 million, which the Hartford, Connecticut-based health insurer expects to finance with available resources, according to an Aetna news release. The deal is expected to close in 2015, according to the release.
The move could be the initial foray of large insurers seeing the growing importance of human resources and benefits technology and software firms like bswift, Castlight Health and Zenefits in the health care space. The software and services provided by bswift help streamline benefits, HR and payroll administration for employers and health insurance exchanges nationwide.
“The bswift acquisition is symbolic of how almost every company in every industry is emerging as a tech company,” said R. “Ray” Wang, principal analyst and founder of technology research firm Constellation Research Inc. “Nonsoftware tech companies realize that they need to acquire key technologies to compete in a digital world. The acquisition shows how important it is to have a platform to build on.”
Mark Bertolini, Aetna chairman, CEO and president, said in a written statement that bswift’s consumer-friendly technology for benefits shopping and administration fits well with its health care exchange strategy.
“With more employers giving employees their choice of benefits via private exchanges, bswift’s technology platform will provide Aetna with the capability to deliver a new private-exchange offering for employers of all sizes where the focus is on helping people easily choose a plan that’s right for them and their families,” Bertolini said.
Dijuana Lewis, Aetna’s executive vice president for consumer products and enterprise marketing, added, “Selecting a health plan is an important decision, and bswift’s consumer shopping, buying, enrolling and decision-support features will help simplify what can be a confusing experience. This acquisition will help Aetna advance our consumer vision to transform the health benefits industry to a retail model that is consumer-centric, affordable and convenient.”
Companies are recognizing that employee communication and engagement in today’s digital world requires a consumer-oriented mindset applied to the tools and technologies that must be used to engage our digital workforce, said Yvette Cameron, research director of human capital management technologies at consultancy Gartner.
"The acquisition of bswift by Aetna is yet another example of the growing trend in the industry to bring consumer experiences and engagement focused technologies into the workforce in highly relevant, contextual ways,” Cameron said in an email.
Bswift was founded in 2000 and has 380 employees. The company has experience in handling public, private and broker exchanges and serving employer groups of all sizes, according to a news release. Bswift is owned by its employees and numerous investors, including private equity firm Great Hill Partners. Bswift will operate as a separate business within Aetna under its existing leadership structure.
“We at bswift are thrilled to become a part of Aetna at such a pivotal time in the transformation of the health care system,” said bswift CEO Rich Gallun. “Together, bswift and Aetna can contribute to more affordable health care by engaging, educating and empowering consumers to make value-based decisions.
“Aetna will help expand the reach of our technology and benefits services with a goal of creating a true consumer marketplace for health care. We look forward to continuing the growth of our core business with employers, brokers, carriers and other organizations, in addition to adding more business by working with Aetna.”
—Sarah Sipek, a Workforce associate editor, contributed to this story.
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