The NIB Holdings Limited (ASX: NHF) share price is on watch today after announcing a digital health investment.
NIB’s acquisition
The private health insurer announced that it has bought a 50% stake in the Australian digital health start-up, Midnight Health, for a total of $4 million.
NIB said that this deal will help bring to life elements of NIB’s payer to partner (P2P) strategy as it moves towards being a business about good health and disease prevention as much as it has been about being there for members once they’re already sick, injured or in need of hospital support like giving birth.
The company also said that the partnership with Midnight Health is another step in delivering personalised health treatment packages in the broader healthcare market.
What is Midnight Health?
NIB explained that Midnight Health was established in October 2020 with a patient-led digital healthcare platform integrating telehealth technology, doctors, pharmacy networks and other health partners to provide a seamless patient experience.
The core areas of support are men’s health (Stagger) and women’s health (Youly), with plans to expand into senior health, gut health, cannabidiol products and other health needs in the coming months.
Management comments
NIB Managing Director Mark Fitzgibbon said:
“There’s a large marketplace for healthcare products and services we’re generally not able to cover through private health insurance so this extends our reach. It also allows us to offer additional personalised support for private health insurance members.
“Importantly, it will introduce many young people to NIB who may not yet be ready for private health insurance.
“They already have more than 4,500 subscribers and we naturally expect this to grow with our close involvement.”
Is the NIB share price good value?
This deal isn’t material to NIB and said it wasn’t going to impact FY22 earnings.
However, if Midnight Health is successful then I can see that this digital service would add value for NIB and its shareholders.
I’m not sure if NIB shares are worth considering at the moment. It has gone through a recovery over the last 12 months, so I’m not sure if it’s good value today or how the private health insurance market is going to evolve.
