Terms of the deal, which is still subject to regulatory approval, were not disclosed. G.E. expects the deal to close in the first quarter of 2014, according to announcements on both companies’ websites.
“Labor costs represent over 50 percent of hospital operating budgets,” said Michael Swinford, the president and chief executive of GE Healthcare Services, in the statement. “With this acquisition, GE Healthcare will be able to address a significant portion of hospital operations costs – assets, patients and labor – with a mix of software, real-time data, powerful analytics and professional services.”
More than 1,600 hospitals and staffing agencies use API’s scheduling, staffing and other human resource technology, according to the announcement. The company provides tools help hospitals to match patients with the right health care worker quickly.
“Fifty percent of the hospitals in this country still schedule their people manually,” said J.P. Fingado, API’s president and chief executive. “By putting optimization technology in place, you can start to have a massive effect on the quality of care and the cost-savings at a hospital.”
G.E. generated 73 percent of its revenue from its industrial operations, which includes power and water, aviation, oil and gas and health care activities. While a significant portion of the company’s sales still comes from its financial services unit, GE Capital, the conglomerate has moved away from some of the riskier activities that got it into the financial crisis.
The company reported that net earnings had risen 5 percent to $4.2 billion last quarter, reflecting a renewed focus on industrial products like oil pumps, jet engines and home appliances. G.E.’s health care unit generated about $1 billion in profit in the fourth quarter, a 4 percent increase over the same period a year earlier.
GE Healthcare helps hospitals improve their operational efficiency, and has been looking for ways to expand into the labor side of the healthcare industry. The company provides tools, for example, to help a nurse in an emergency department track down a piece of equipment quickly, or allow staff to track patients as they move around the hospital.