EHR vendor Allscripts has made an agreement to purchase patient communication app maker HealthGrid for $60 million in cash, with an additional $50 million in earn-out payments based on HealthGrid achieving certain revenue targets over the next three years, according to a recently registered SEC filing. The merger of the two companies is expected to close sometime during Q2 2018.

“The growing adoption of value-based care, combined with the modest level of usage of patient portals across the industry, has made it critical to take a new approach to patient engagement solution design,” Richard Poulton, president of Allscripts, said during the company’s Q1 earnings call yesterday when announcing the acquisition. “We expect to tightly integrate the Health Grid capabilities into our FollowMyHealth platform, adding functionality that would enable providers to reach 100 percent of their patient populations by leveraging existing patient contact information rather than requiring patients to sign up for the portal.”

HealthGrid is a mobile app platform that delivers care and education materials traditionally distributed from practices to patients via paper. For example, an electronic discharge document provided when a patient walks out the door could include appointment reminders, educational videos, or even updates for parents on where their child is within the hospital at a given time, Ed Martinez, SVP and chief information officer with Nicklaus Children's Health System and HealthGrid customer, explained to MobiHealthNews back in March.

“Keep the patient engaged and keep them in the center of the discussion,” Martinez said at the time. “If you do that, margins go up, satisfaction goes up, compliance goes up because the patient is more aware of what they have to do.”

Allscripts hasn’t shied away from M&A opportunities lately. In October the company announced the acquisition of McKesson's Enterprise Information Solutions business, which Poulton said was progressing well during the earnings call. A few months later, Allscripts also announced an agreement to acquire another EHR, Practice Fusion, and according to Poulton is currently in the process of integrating it with the payer and life science business unit. On the other hand, Allscripts also closed on a divestment agreement with Hyland Software that unloaded its OneContent offering and returned $260 million.

Poulton said that the company’s leadership is happy with its recent moves across the EHR market, and was optimistic about what its most recent acquisition will be bringing to the table.

“Patient engagement is a top-of-mind challenge for CEOs and leaders of healthcare provider organizations of all sizes,” Poulton said during the call. “Once integrated with FollowMyHealth, we believe the platform will have the broadest reach of pre-encounter, during encounter, and post-encounter patient engagement opportunities in the entire industry. Since most of our EHR clients use FollowMyHealth today, we see a meaningful opportunity to grow with this expanded offering.”

Allscripts’ quarterly report also included strong gains for the company, including a 24 percent increase in GAAP revenue and $304 million in bookings (up from $286 million during the same time last year).

Twitter: @dave_muoio
Email the writer: dave.muoio@himssmedia.com

Correction: This story was updated to clarify Ed Martinez is the SVP and chief information officer with Nicklaus Children's Health System. Raj Toleti is the CEO of HealthGrid.