Waystar to Acquire Iodine Software in $1.25B Deal, Expanding AI-Driven Capabilities in Healthcare Payments
Waystar has announced a definitive agreement to acquire Iodine Software for $1.25 billion in a move aimed at accelerating its efforts to modernize and automate healthcare payments using AI. The acquisition is expected to enhance Waystar’s clinical and financial AI capabilities, expand its market reach, and deepen relationships with top health systems across the U.S.
The deal, structured as a 50/50 mix of cash and stock, is anticipated to close by the end of 2025, pending regulatory approvals and customary closing conditions.
Strengthening AI Leadership in Revenue Cycle Management
Iodine Software brings with it a strong presence in clinical intelligence software, trusted by more than 1,000 hospitals and health systems. The company’s platform is designed to eliminate revenue leakage and ensure accurate reimbursement through advanced AI models trained on a dataset representing more than a third of all U.S. inpatient discharges.
By combining Waystar’s payment automation platform with Iodine’s clinical documentation and mid-revenue cycle tools, the companies aim to tackle a key challenge: reducing the estimated $440 billion in annual administrative costs burdening healthcare providers.
“Welcoming Iodine’s team and platform to Waystar is a major step in our mission to simplify healthcare payments,” said Matt Hawkins, CEO of Waystar. “Together, we can further reduce denied claims, automate manual work, and improve transparency for both providers and patients.”
Strategic and Financial Highlights
The acquisition is expected to be accretive to Waystar’s gross margin and adjusted EBITDA by 2027. Additional benefits of the deal include:
- Expanded total addressable market: The acquisition is projected to increase Waystar’s market opportunity by more than 15%.
- Deeper hospital relationships: The combined company is expected to serve 17 of the 20 U.S. News Best Hospitals.
- Cross-sell potential: Iodine’s subscription-based revenue model offers strong synergy potential with Waystar’s existing client base.
- AI-driven efficiencies: Integration of Iodine’s clinical reasoning engine, IodineIQ, with Waystar’s data platform is expected to enhance GenAI applications in prior authorization, claims management, and appeals.
Comments from Leadership
“We are proud to have built a market-leading AI platform focused on helping hospitals capture the full value of care,” said William Chan, CEO and Co-Founder of Iodine. “Joining Waystar allows us to scale that mission further.”
Mike Kadyan, Co-Founder and Chairman of Iodine, added, “Our success has been rooted in strong partnerships and real outcomes—we’re excited to take that even further within Waystar’s platform.”
Advent International, Iodine’s majority shareholder, will receive Waystar shares as part of the deal and will be subject to an 18-month lock-up period post-close.
Transaction and Market Outlook
The deal will be financed with a 50% cash and 50% stock split. After the transaction closes, Waystar shareholders will own about 92% of the combined company, with Iodine shareholders holding the remaining 8%. Waystar expects to maintain a solid financial position with an adjusted net leverage ratio of approximately 3.5x at closing.
Waystar also shared preliminary Q2 2025 results, projecting approximately $271 million in revenue—up 15% year-over-year.
A conference call discussing the acquisition was scheduled for July 23, 2025, at 5:30 p.m. ET.
About Waystar and Iodine
Waystar provides cloud-based software solutions for healthcare payments, processing over $1.8 trillion in gross claims annually across roughly half of the U.S. patient population.
Iodine Software specializes in AI-powered clinical intelligence that supports documentation, utilization management, and prebill workflows—helping hospitals capture accurate reimbursement and reduce manual work in the revenue cycle.
