Independence Blue Cross, a Philadelphia-based health insurance company, is selling a minority stake of its subsidiary, Tandigm Health to Penn Medicine, a large health system in the same city.
A spokesperson declined to provide specifics of the deal.
Starting in 2023, Penn Medicine will use the Tandigm network as its value-based care network. Contracts will be rolled out over the next three years. According to Penn Medicine, the agreement will bring more providers and patients into this value-based care arrangement.
Tandigm's technology platform aims to help primary care physicians engage patients in value-based care relationships. The platform uses analytics, telemedicine and other digital health tools.
Founded in 2014, Tandigm has a network of 400 primary care doctors, throughout the Philadelphia region. Tandigm and Penn Medicine began partnering in 2017 for the launch of a program focused on hospital readmissions.
Their latest deal follows a series of high-profile digital health mergers and acquisitions focused on the primary care space.
On September 5, CVS Health paid $8 billion to acquire Signify Health, the Dallas-based home health risk assessment company. In late July, tech giant Amazon acquired One Medical for nearly $4 billion in cash.
“We’ve seen a lot of IPOs in the healthcare space,” said Matt Wolf a director and senior healthcare analyst at consulting firm, RSM. “Many of these companies are viable. They might need to just be folded into a strategic buyer to be more economically viable or taken private.”
Wolf and other experts said they’re not anticipating a slowdown in digital health merger and acquisition activity any time soon.