By Leslie Small
CVS Health Corp. — which is on the brink of closing its $69
billion purchase of Aetna Inc. — is offering up more details about the
"revolutionary" new health care model it plans to create after the
companies officially combine.
The Dept. of Justice approved the CVS-Aetna deal in mid-October, contingent upon Aetna selling its Medicare Part D Prescription Drug Plan (PDP) business to WellCare Health Plans, Inc. In addition, 23 out of the 28 states that must approve the transaction have now done so, and CVS is "well down the line" with the remaining five states, CEO Larry Merlo said on the company's third-quarter earnings call. He said CVS now expects to close the deal before Thanksgiving.
Once the companies combine, CVS expects to glean "substantial" cost savings by better managing common chronic conditions, optimizing and extending primary care, and reducing avoidable hospitalizations, he said.
Merlo also noted that the effort to redesign the consumer experience will be an "increasingly important competitive differentiator" for CVS-Aetna.
"As a cornerstone of this work, we will have our first concept stores up and running early next year, and through these stores we will pilot the programs just mentioned and explore new services to better address the cost-quality-access challenges of consumers and identify the most effective and scalable solutions so they can be rolled out more broadly across our footprint," he said.
Meanwhile, on the Cigna Corp.'s earnings call on Nov. 1, CEO David Cordani updated investors and analysts about the status of its pending purchase of Express Scripts Holding Co., which remains on track to close by the end of the year. "Express has a very good track record of innovation…[and] we'll be doing more of it together," he said of the company's plans post-close. He conceded that the marketplace "will always be in a wait-and-see mode," but said Cigna's customers are "positive" about the deal.
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