Health insurer Aetna has agreed to acquire PayFlex Holdings, a provider of web-based benefit administration services, for $202m to expand its existing consumer fund services (CFS) business.

As part of this acquisition, Aetna expects to combine PayFlex and its existing CFS business into a single unit with approximately two million accounts.

Aetna said the merger of the these businesses will enable PayFlex to continue to sell its products on a standalone basis as well as on an integrated basis with its products on a single platform.

The health insurer expects to fund the transaction with available resources.

Aetna chairman, CEO and president Mark Bertolini said this acquisition fits well with Aetna’s core business, which has a strong focus on consumer-directed product offerings.

"With an increased focus on consumerism, the acquisition of PayFlex will extend Aetna’s ability to provide members with flexible, customized, easy-to-use tools and solutions to better manage their health care expenses," Bertolini said.

PayFlex CEO Robert Natt PayFlex said its proprietary HealthHub technology platform will be a great addition to the Aetna portfolio of products and will create unique market advantages for existing and future potential customers.

The transaction is subject to customary closing conditions, including Hart-Scott-Rodino antitrust regulatory approval and is expected to close in the second half of 2011.