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CVS and Aetna – A New (and Improved) Healthcare Giant?

Just announced this past Sunday, pharmacy chain giant CVS Health agreed to purchase Aetna, a large, national health insurance company, for about 70 percent of Jeff Bezos (Amazon) net worth – or $69 billion.

CVS is one of the largest providers of pharmacy services in the country, with almost 10,000 retail pharmacy locations and about 1,100 MinuteClinic walk-in clinics, while Aetna is the third-largest U.S. health insurer. By combining, their total annual revenue would be $240 billion. In a joint statement, CVS and Aetna claim this deal will “redefine access to high-quality care in lower cost, local settings – whether in the community, at home, or through digital tools.” Further, according to the CVS Health President and CEO, Larry Merlo, “…With the analytics of Aetna and CVS Health’s human touch, we will create a healthcare platform around individuals.”

Both organizations jointly claim the combined company will “dramatically further empower consumers,” and “better understand our members’ health goals, guide them through the healthcare system and help them achieve their best health.” By having a broader use of data and analytics, the new organization hopes to benefit the entire healthcare system and be able to address the cost of treating patients with chronic diseases. The combined synergy of both organizations lay out a vision to reshape healthcare into a new approach.

This large ‘deal’ has the makings of being a great thing – for both organizations (CVS and Aetna), their shareholders and those covered through their products.

But will it?

Quite often, the American culture is fixated on the belief that “bigger is better,” or that “new and improved” will always serve us best. Perhaps it will. But as I mentioned in my blog, “The Illusion of Getting ‘Bigger‘” – when Aetna was attempting to purchase Humana (a deal that was subsequently blocked by a judge in early 2017 for antitrust purposes) – such deals are not a slam-dunk to fix an ailing and complex $3+ trillion healthcare system. In fact, in some cases, larger integrated delivery networks may make the coordination efforts to serve patients more cumbersome and inefficient.

The twists and turns of organizations finding new approaches and seizing opportunities to make healthcare more affordable, safer and much more efficient is clearly a laudable goal. But, to be so, the patient must always be at the center of these initiatives. The profit and incentive motives are important, but getting it right for the patient should be the primary driver of any meaningful change.

Let’s hope the hype is matched by results.

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