Benefitfocus deals focus on information

Charleston Post and Courier
John McDermott
August 23, 2010

The summer of 2010 is shaping up to be a season of acquisitions for Charleston software company Benefitfocus.

The latest deal for the expansion-minded firm was the purchase this month of an Oklahoma technology business that drills down into health care data to help employers manage expenses.

Benefit Informatics Inc. is now a wholly owned subsidiary of the Daniel Island’s Benefitfocus, which makes software that allows workers to go online to review, enroll in and monitor their medical plans and other payroll perks.

Benefit Informatics’ management will remain in place. Terms of the deal were not disclosed.

Benefitfocus said the newly acquired firm’s technology spots trends about health-plan usage and churns out analytical reports for chief financial officers and human resource managers. Its software, for example, can predict “an increase in claims and pharmacy expenses” and help employers spot potential abuse or fraud.

“This opens up a whole new world of capability, creativity and analysis,” said Shawn Jenkins, chief executive officer of Benefitfocus, which has grown to 525 employees since it was formed 10 years ago.

The Sooner State deal came on the heels of another acquisition, that of a local data-mining company, along with its three patent applications and proprietary software code. The sale of Charleston-based BeliefNetworks Inc. to Benefitfocus was finalized in June. Financial terms of the sale were private.

The two deals are expected help the firm better customize its Web-based products so its user can make more informed decisions.

“We’re kind of on a data binge over there,” Jenkins said Friday through a spokesperson.

The 24-worker BeliefNetworks’ specialty was in the field of “semantic search” technology, which its new owner described as the transformation of real-time information, such as marketing-campaign data and social networking conversations, “into actionable knowledge.”

“For example, consumers can opt to have the content of their individual health profile scanned in order to receive recommendations for benefit selection and suggest behavior changes to improve their personal health and wellness,” according to a statement.

BeliefNetworks was launched in 2007 on Savannah Highway by West Ashley native Ted Tanner Jr., a veteran of five Silicon Valley startups who also held architect positions at Apple Inc. and Microsoft Corp., and Lisa Maki, a former Microsoft executive. The company raised more than $2 million in private seed money in 2009, following an undisclosed investment in late 2008 from Charleston-based Palmetto Investments & Exchange Group. Both are now with Benefitfocus.

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