Towers Watson to acquire Extend Health for $435 million

US-based professional services firm Towers Watson & Co, yesterday said that it would buy Extend Health Inc, operator of the country's largest private Medicare exchange for about $435 million.

San Mateo, California-based Extend Health was founded in 2004 to serve Medicare-eligible retirees and their corporate sponsors. It is the largest private Medicare exchange in the US, and has helped hundreds of thousands of retirees choose the individual Medicare plan that meets their medical needs and budget.

Medicare exchange allows consumers to compare plans from different carriers side by side.

The Extend Health solution includes proprietary exchange and decision support technology. Its solution allows retirees the opportunity to select from thousands of private Medicare plans from more than 75 national and regional insurance companies, and employers to provide access to individual coverage, typically with a defined contribution subsidy.

New York-based Towers Watson said that more employers have used Extend Health than any other company to transition their retirees to a private Medicare exchange.

Extend Health claims to have over 130 companies as its customers, including Ford Motor, General Motors and Caterpillar Inc, and has helped them save as much as $400 million annually in retiree health insurance costs.