Wipro Acquires BPaaS for Healthcare With Healthplan Services

Wipro is increasing the competitive intensity of healthcare operations services with its acquisition of HealthPlan Services (HPS) for $460 million (~2x revenue). The acquisition will bring Wipro Healthcare and Life Sciences revenues to more than $1 billion annually. That’s notable, but what also catches our attention about this acquisition is how it positions Wipro—and healthcare insurance plans—to grow. HPS describes its vision as making it as easy and pleasant to buy and manage health insurance as it is to shop for shoes or book a trip online. Wipro has shared a similar vision with HfS, but heretofore lacked some key capabilities to deliver this vision to clients.

With its acquisition of HealthPlan Services, Wipro continues its move away from legacy systems and sourcing to deliver around a business process as-a-service (BpaaS) model. This acquisition expands Wipro’s suite with sales and marketing capability for health insurance carriers (plans and other companies) to attract, register, and manage consumers via public and private exchanges. It also includes support for analytics to better understand and support the membership base, to drive increased satisfaction and loyalty.

Since 2008, HPS has shifted its focus from employer and group health insurance management to individual coverage, investing in BPaaS that helps health plan carriers connect with public exchanges or launch private exchanges. HPS tapped into a market need driven by the requirements of the Patient Protection and Affordable Care Act and links clients to more than 40 public exchanges and 150 private exchanges. Clients include Allstate, Cigna, Humana, and Kaiser Permanente, a complementary footprint for Wipro.

The HPS solution suite includes:

• ExchangeLink: To connect health plans and exchanges, transfer information and process transactions
• SalesLink: To support customer acquisition
• ServiceLink: To manage member billing, premium reconciliation and customer service
• LoyaltyLink: To drive member and market analytics, and identify opportunities to renew, cross-sell, and support member activity—for on and off exchange members

Wipro’s current strength in healthcare operations services is with its Medicare Advantage solution, which more than 100 healthcare plans use to support insurance administration for people over age 65—covering eligibility, enrollment, claims processing, and reconciliation. This acquisition extends Wipro’s healthcare offering into the Exchange market—and the under 65 age group—and adds capability for member recruitment and management, with analytics to increase member retention. With the integration of the HealthPlan Services solution suite into Wipro’s evolving architecture for healthcare operations, the acquisition can help move it in the direction of enabling an end-to-end member-centric cross-generational healthcare architecture.

For the past couple of years, we have seen service providers investing to shift toward more platform-based business process services in healthcare. In 2014, we saw Cognizant invest $2.7 billion in an eye-popping acquisition of Trizetto, bringing in an established healthcare plan administration platform for business process as-a-service and the associated non-linear, IP-based revenue. Part of that acquisition was a robotic process automation capability that has proven to be a valuable asset. Last year, HGS acquired a majority stake in Colibrium, bringing in a suite of sales and marketing, member management and wellness platform-based services to complement the customer service and health administration back end support. This move by Wipro continues the move of leading service providers in healthcare operations to invest in platform-based capabilities that are intended to help healthcare payers increase the efficiency of their administrative operations, support new channels for growth, and help payers to shift their focus to consumer-centric services.