Health insurer Aetna Inc. said Tuesday it would buy privately held health records company Medicity for around $500 million. The Hartford, Conn.-based insurer said the transaction, which it will pay for with existing resources, should be financially neutral next year.

Medicity makes health information exchange technology, letting doctors and hospitals share medical information. It reaches around 760 hospitals and 125,000 doctors, according to the Salt Lake City-based company.

Last year, Medicity merged with HIE business Novo Innovations.

Aetna said Medicity will continue to operate under its own name with its current leadership, under founder Dr. James K. Lassetter.

Aetna's stock remained flat at around $30.32 in morning trading Tuesday.

Click here to watch our video interview from HIMSS 2010 in March with Medicity vice president of marketing Bill Sims.

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