Reducing health care costs: Aetna-CVS merger receives approval

The health care industry could see numerous changes with several big-name mergers.

The health care industry has seen some considerable shake ups recently, with several big-name mergers centering around cost reduction. The acquisition of one provider by another can produce many different results, particularly when it comes to human resources managers working to ensure that their employees have the adequate coverage and benefits needed.

Let's take a closer look at two recent mergers, one in which CVS acquired Aetna, as well as an agreement between Cigna and Express Scripts.

Aetna-CVS: Stakeholders approve

According to The Hill contributor Jessie Hellmann, the merger between health and dental plan provider Aetna and pharmacy service provider CVS Health saw some delays initially after the Department of Justice requested additional information on the proposed deal. The merger, which would involve a $69 billion agreement between the health care giant and pharmacy chain, is viewed as vertical industry movement. This comes in contrast to the blocked Aetna and Humana merger, which Justice Department officials argued would reduce sector competition.

 As stakeholders on Aetna's side awaited necessary DOJ approval, they did hold an internal vote, where 97 percent agreed to approve the merger, The Hill contributor Nathaniel Weixel reported.

Female pharmacy technician holding out prescription card to customer. A proposed deal with see the merger of CVS Health and insurer Aetna.

Aetna-CVS: Prioritizing customer care 

This bringing together of health insurer and pharmacy provider could considerably impact the health care industry. However, it may take some time for these benefits to shine through. Stakeholders on both sides expect the merger to go through in the second half of 2018, thanks to favorable signals from federal regulators.

"When this merger is complete, the combined company will be well-positioned to reshape the consumer health care experience, putting people at the center of health care delivery to ensure they have access to high-quality, more affordable care where they are, when they need it," CVS Health President and CEO Larry Merlo noted in a recent statement.

Keeping up with cost reductions: Cigna and Express Scripts

As Weixel noted, the ability to drive down prices for customers has been a driving force behind the CVS Health-Aetna merger, and this has created a ripple effect within the health care industry. Now, other firms are looking to join forces in order to create better, more cost-efficient services for customers, including insurer Cigna, which recently announced plans to acquire pharmacy benefit management organization Express Scripts.

The New York Times reported in early March that the potential Cigna-Express Scripts merger would involve a $52 billion deal resulting in reduced costs and improvements revolving around the use of patient medical and pharmacy histories.

"The deal is the latest in a wave of consolidations that is sweeping through the health care industry," New York Times contributors Katie Thomas, Reed Abelson and Chad Bray wrote. "Companies are reacting to concerns over rising health care costs and the possibility of new rivals entering the fray."


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