Information on the Target

Smarter Technologies has recently emerged as a significant player in the healthcare automation sector. By uniting the strengths of three notable companies—SmarterDx, Thoughtful.ai, and Access Healthcare—Smarter Technologies aims to revolutionize the administrative workflows of hospitals and health systems. Under the leadership of CEO Jeremy Delinsky, the organization has launched an AI-powered revenue management platform designed to enhance financial performance while optimizing operational efficiency.

Smarter Technologies now boasts over 27,000 employees and 24 global service centers, serving more than 200 clients and over 60 hospitals. The company processes over 400 million transactions annually and oversees approximately $200 billion in combined revenue, positioning it as a leader in healthcare revenue cycle management.

Industry Overview

The healthcare sector in the United States is increasingly challenged by administrative inefficiencies and high operational costs, particularly in billing and collections. A recent McKinsey study highlights that hospitals and health systems are spending over $250 billion each year on these costs, often compounded by errors and inefficiencies. Additionally, a survey conducted by the American Hospital Association revealed that half of the hospitals surveyed reported having over $100 million in aged accounts receivable, increasing the necessity for effective financial management solutions.

As the industry transitions towards more automated solutions, there is a growing demand for innovative technology that addresses these challenges. Smarter Technologies is strategically positioned to meet this demand by offering an advanced automation and insights platform that leverages artificial intelligence to streamline revenue management and improve financial outcomes for healthcare providers.

Moreover, the continuing rise in claims processing times by commercial payers, which has increased by nearly 20%, amplifies the urgency for efficient billing systems. The healthcare industry now requires platforms that not only automate but also enhance the accuracy of revenue cycle operations.

In this context, Smarter Technologies stands out, combining human-in-the-loop services with AI capabilities, enabling a more comprehensive approach to resolving the complexities in healthcare administration. Their modular solutions are particularly valuable to larger healthcare organizations that operate at scale.

The Rationale Behind the Deal

The primary motive behind the formation of Smarter Technologies is to address the significant inefficiencies prevalent in the healthcare sector's administrative processes. By integrating advanced AI technologies with existing human expertise, the new platform aims to revolutionize the revenue management landscape. The need for a flexible platform that can adapt to the unique operational demands of healthcare organizations is evident, as highlighted by the increasing costs associated with administrative inefficiencies.

The partnership of three well-established entities—Access Healthcare, SmarterDx, and Thoughtful.ai—provides a robust foundation for this initiative. Each company brings a wealth of expertise and specialized technology that enhances the overall capabilities of Smarter Technologies, ultimately allowing for improved client service and enhanced financial performance.

Information about the Investor

New Mountain Capital, LLC, based in New York, is a leading growth investment firm with more than $55 billion in assets under management. The firm is known for its commitment to business building and long-term capital appreciation rather than high-risk investments. New Mountain Capital focuses on identifying and partnering with high-quality growth leaders across select industries, and it takes an active role in helping its portfolio companies achieve their full potential.

By investing in Smarter Technologies, New Mountain Capital is fostering innovation within the healthcare sector, aiming to modernize operations through advanced digital tools and data utilization. The firm's strategic investment enables Smarter Technologies to expand its capabilities and reach, effectively addressing the pressing issues faced by healthcare organizations today.

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As experts in the field, we view the establishment of Smarter Technologies as a promising investment opportunity. The combination of advanced AI technology and human expertise provides a unique solution to longstanding inefficiencies in healthcare administration. By targeting the substantial financial burdens faced by hospitals and health systems, Smarter Technologies positions itself to deliver significant ROI through its innovative revenue management platform.

Moreover, the increasing necessity for automation in healthcare operations is underscored by the pressing challenges highlighted in industry studies. The ability of Smarter Technologies to streamline processes and enhance accuracy ensures that it can deliver tangible value to its clients from day one, making it a compelling choice for healthcare organizations seeking to optimize their revenue cycles.

Furthermore, the backing of New Mountain Capital adds to its credibility, suggesting strong financial support and strategic guidance, which are crucial for sustainable growth. With a well-rounded team of industry experts and the integration of advanced AI technologies, Smarter Technologies is likely to be at the forefront of healthcare innovation.

In conclusion, Smarter Technologies is poised to revolutionize the healthcare revenue cycle management landscape, making it a potentially lucrative investment as the company leverages modern technology to address urgent operational challenges within the industry.

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