CVS To Buy Aetna for $69 Billion

In what’s being described as a landmark deal in the health care industry, CVS Health has agreed to buy Aetna for $69 billion, the Wall Street Journal (WSJ) reports. Unlike the proposed deals that would have allowed the mergers of Cigna and Anthem, and Aetna and Humana—which the courts barred this year on the grounds that they would constitute a monopoly—the CVS-Aetna deal would marry two very different types of health care industries: insurance company and pharmacy provider. (Managed Care reported on the Anthem-Cigna and Aetna-Humana merger attempts here and here.)

Experts tell the WSJ that the deal would equip both companies to better face major challenges. Amazon has been making noises to jump into the pharmacy business, in direct competition with CVS. And Aetna lacks the pharmacy presence that the larger UnitedHealth Group has thanks to United’s affiliated PBM business Optum RX.

It won’t necessarily be an easy merger for either CVS or Aetna.

“The combination faces substantial challenges, including the huge operational task of knitting together the companies’ diverse operations so that customer experiences are smooth and seamless,” the WSJ reports. “The deal isn’t likely to deliver as many cost-cutting benefits as combinations with more direct overlap, such as Aetna’s scuttled acquisition of Humana, analysts said. CVS will need to keep much of Aetna’s infrastructure since it doesn’t currently provide health insurance.”

Source: Wall Street Journal

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to jfedder1@hfhs.org or online at http://p.rfer.us/HENRYFORDlXqAJA