Reflection from An Independent Physician’s Standpoint
i.e., Through the lens of your IPA Manager…
There are many moving parts to this important transaction between CVS Health and Aetna. It is a big Wall Street deal. And, it is very important to the business of the physician and clinician members of PDA. It will also be important to the patients of our nation. Even the national economy will be impacted.
The macro result is achievement of a new level of major healthcare integration and consolidation. The combined market clout puts Aetna more in a position like UnitedHealthcare in its ability to leverage an integrated Pharmacy Benefit Manager service in negotiating prices and establishing preferred tiers of employee benefits with manufacturers.
Rita Numerof, PhD, president of Numerof & Associates, said in an emailed statement to Becker’s Hospital Review, “With CVS’s large and growing clinical services footprint, Aetna can steer patients to CVS pharmacies and clinics — in many cases avoiding the costs of higher emergency room or other outpatient services. The merger can make expanded CVS services in-network and others out-of-network, putting additional pressure on conventional health systems to competitively lower the costs of their outpatient services.”
It seems that a major strategic position is how this will affect the Aetna positions regarding national network interest and support of physician-controlled IPAs versus physician and clinician groups owned by facility-based entities. These answers remain to be seen.
The traditional posture of physicians has been to endeavor to participate in all accessible managed care contracts with a focus on securing the “best available” reimbursement. That may well be changing. It is not unlikely that a practitioner is soon to be more concerned about securing network participation and a seat at the proverbial value-based compensation table.
PDA is intensely working to break out the desired future roles and opportunities for its members.
The facts as we know them….
CVS Health inked a definitive merger agreement to acquire all outstanding shares of Aetna for roughly $69 billion in cash and stock. It values Aetna at about $207 per share, higher than previous estimates of $200 to $205 per share. When including the assumption of Aetna’s debt, the transaction totals $77 billion.
Upon closing, Aetna’s Chairman and CEO Mark Bertolini will join CVS Health’s board of directors, along with two other Aetna leaders. Aetna will operate as a stand-alone business unit under the CVS Health umbrella, and the insurer’s management team will helm the subsidiary.
The companies said the deal will provide localized, community-based care across CVS Health’s 9,700-plus pharmacies and 1,100 clinics. Sources familiar with the deal told Reuters that CVS Health plans to significantly extend health services at its pharmacies under the merger.
The transaction is slated to close in the second half of 2018. It is subject to regulatory approvals.
More to come….