Web insurance marketplace and health insurance exchange company Connecture announced earlier this month that it had acquired DRX (formerly DestinationRx), in a deal that will join two companies that offer online enrollment and insurance marketplaces for commercial plans and government insurers alike.
"What it really comes down to is what DRX does in the seniors market and with Medicare Advantage and PDP is what Connecture does for the under 65 markets," said Dan Maynard, Connecture co-founder, president and now general manager of DRX. "It takes us for sales automation, shopping and enrollment, it takes Connecture's core services into the Medicare Advantage market."
Maynard added that the purchase expands Connecture's footprint to a broader payer market, expands it's the client base and also provides a broader reach with both Blues plans and some of the meg insurers like UnitedHealth and Aetna, among others.
The core offering of DRX is PlanCompare, a shopping and comparison tool used by a number of Medicare sponsor sites, as well as Medicare.gov. According to Connecture, between the 7 of the top 10 largest Medicare sponsor sites and Medicare.gov that employ PlanCompare, it has processed more than 12 million applications.
The other major offering form DRX is DrugCompare an online tool that allows consumers to compare and find medications that are an alternative to their prescription medications, often at a lower cost. DrugCompare is employed by a number of pharmacy benefits management companies to help their members more effectively use and manage their drug benefits.
"Two undeniable trends attracted us to DRX," said Brett Carlson, board member at Connecture and vice president at Great Point Partners, a venture capital firm that led a recapitalization of Connecture last summer. "We've been watching the acceleration of senior enrollment into managed care and the increasing utilization of competitive marketplaces for insurance purchasing in the private sector. DRX strengthens our technological capability and value proposition for our clients in both of these key strategic areas."
The ability to cross-sell each company's products and services to the clients of the other was also a strong selling point.
"We are already getting leads in from DRX clients that have an interest in under-65 platforms that Connecture supplies, so that seems to be already in the payer client base," Maynard said.
Existing offerings at Connecture fit well to allow the company to serve both public and private payers. Two main offerings of Connecture include its modular commercial-off-the-shelf products aimed at the state HIX market called StateAdvantage, which includes everything needed to develop a state HIX. Connecture also offers a plan module that can be used by states that wish to participate in a federal partnership exchange.
InsureAdvantage, targeted at the commercial market, is a private HIX product and service that aids insurers in providing their customers with a health benefits administration platform that helps guide employees through the enrollment process.