After a longer than expected evaluation period by the Department of Justice, CVS Health’s $69 billion acquisition of Aetna has hit another glitch. Judge Richard J. Leon of the U.S. District Court for the District of Columbia opted not to sign off on the deal, instead imposing new demands on the two organizations. I’m confident that, in time, Judge Leon’s demands can be met and that the two organizations will move forward as planned. Undoubtedly, the final agreement will read like a very long receipt—even by CVS standards.
Even without the final stamp of approval, CVS/Aetna could spend the potentially months-long delay preparing for the hard work that lies ahead (while being careful not to share "competitively sensitive" information). The first order of business post-merger will be integrating the two entities so that it translates into a positive experience for the most important constituent in healthcare, the consumer. My review of the numerous press releases, interviews and commentary on the deal points to three core objectives:
- Help consumers to better navigate healthcare. CVS/Aetna has an opportunity to tailor healthcare to consumers’ preferences, thereby improving the way that consumers navigate and receive healthcare, and potentially driving down costs. Independent of the Aetna acquisition, CVS had already begun to expand the channels that consumers use to navigate healthcare by integrating MinuteClinic walk-in clinics in more than 10% of its stores—a number that will soon rise—and expanding its telemedicine services nationwide. The barriers impeding consumers from using these services have little to do with access or capability, but rather are related to low awareness and understanding of coverage.
CVS/Aetna has a unique opportunity to clearly communicate these services by educating consumers on which conditions can be treated through a telemedicine or MinuteClinic appointment, and confirming whether it’s an in-network plan benefit. To give the approach a chance to stick, communication must start at the point of enrollment and then consistently be reinforced across the channels that will reach the consumer.
- Improve chronic disease management. CVS/Aetna will have a direct avenue to help consumers manage chronic disease through better adherence programs such as pharmacist consultations at MinuteClinic locations. The Medicare population might be a good place to start because they have a high incidence of (multiple) chronic diseases, consume a disproportionate share of healthcare and still rely on a mix of in-person and digital engagement.
- Increase cost transparency. Presenting consumers with alternate ways of consuming healthcare is ultimately better for them, with the potential to lower costs with the same health outcomes. CVS/Aetna is lifting the veil a bit on drug pricing and passing discounts negotiated by CVS Caremark (the PBM arm of CVS) to the customer, an approach that’s already receiving positive press.
Many other health plans, providers and employers share one or more of the above aims. What’s different about CVS/Aetna is what an integrated health insurer, pharmacy benefits manager and consumer-focused retailer with 10,000 locations can deliver. “Integration” is the operative word: How that ultimately is achieved and translated to the consumer will make or break the core aims of the combined entity. Of course, with the court delays, there’s also now the question of when the companies will integrate. Aetna and CVS have some joint incentives to integrate, but that doesn’t mean that other health insurers can’t achieve the same consumer-centric aims through targeted integration and partnerships in the healthcare ecosystem—they just have to clear a higher bar for integration.
Then, operationally, the consumer experience must be a smooth one from end to end to encourage repeat usage. Here are a few examples of how this could play out in practice: Consumers could wait less than five minutes to be seen at local walk-in clinics, telemedicine physicians could have Aetna members’ patient records at their fingertips so that they feel like their care is truly connected across channels, and Aetna members with high-deductible health plans could have a clear understanding of the out-of-pocket costs they saved relative to an in-office (or ER) visit.
This will require an immense amount of effort on behalf of both organizations, and I recognize that it will take some time to implement properly. That said, I’m optimistic that such changes hold tremendous promise for the future of healthcare delivery for plan sponsors and health plans—and for consumers, in particular.