CVS Health just revealed a key piece of its plan to change how Americans get healthcare

CVS Health and Aetna officially merged at the end of 2018.

The $70 billion merger combines a chain of nearly 10,000 pharmacies that also owns a drug benefits business with one of the biggest US health insurers. The result is an entirely new healthcare company that can wield a tremendous amount of power over how healthcare gets paid for and provided to patients.

In a presentation on Tuesday at the JPMorgan Healthcare Conference in San Francisco, CVS CEO Larry Merlo outlined for the first time how the combined company will provide healthcare differently. The main goals are: keeping patients healthier and out of the hospital, caring for patients at less-costly locations (such as CVS’s clinics instead of emergency rooms), and pioneering new methods of caring for devastating chronic diseases like cancer and heart failure.

Achieving those goals will help CVS boost its profits. Since it now owns is a health insurer, the company will spend less on medical care if it can keep customers healthier, or care for them at clinics instead of hospitals.

Read more of Business Insider’s coverage from the J.P. Morgan Healthcare Conference here

A big component of the strategy is providing more healthcare in CVS stores, both at the pharmacy counter and via the company’s MinuteClinics. To make space, CVS is removing some products from the front of the stores where it’s piloting the new approach.

“We can open a new front door to health that is both easier to use and less expensive, while at the same time, providing convenient access to high-quality health care,” Merlo said during the presentation.

The strategy also helps CVS find new use for the floor space in its 9,800 locations, as customers increasingly shop for everyday goods on Amazon. And providing more care in stores can help CVS counter forays by rivals like Amazon into healthcare. Amazon, for its part, acquired the pharmacy startup PillPack last year, marking its entry into the drug-delivery business.

To start, CVS is opening up its first “health hub” in a redesigned store in Houston in February. On Tuesday, the company revealed what that store will look like. You can see that there’s a lot more store space devoted to providing healthcare, including at the clinic and pharmacy.

The MinuteClinics in the pilot stores will offer more services, including disease screenings and blood draws. CVS already has about 1,100 MinuteClinics across its stores. They’re usually staffed by nurse practitioners or physicians’ assistants, and now provide basic checkups and care for minor illnesses and ailments.

The stores will also have a “care concierge,” who might help individuals understand how their health insurance works, or help them use health and wellness devices and technology.

CVS is also testing several other initiatives to improve how its customers get healthcare, using the resources of the combined company.

In one program, CVS pharmacists will call Aetna members who the company thinks could be at high risk of a negative health event, and counsel them on how to improve their health. A second outreach program will focus specifically on Aetna members with heart disease.

Another focuses on Aetna customers who’ve been in the hospital. To make sure they get the care they need after leaving the hospital and prevent them from having to go back, Aetna care managers will schedule followup visits for them at MinuteClinics, if they can’t get in to see their usual doctor.

At the MinuteClinic, healthcare providers can make sure the patients understand their disease and how to manage it. They’ll also check that patients have the right prescription drugs and know how to take them.

“Helping people on their path to better health has been a cornerstone of our purpose at CVS,” Merlo said. “As we zoom out and look at the broader health care market and the savings that can be achieved by more effectively managing chronic conditions, the opportunity here is massive”

If CVS uses the same format that they use for the Silver Scripts Part D prescription program… they will put financial incentives/disincentives on copays and deductibles to “encourage” pts to use only CVS’ array of care thru one of their programs.  I have seen statements from they  – in regards to the Aetna merger – that they would not “force” Aetna policy holders to use CVS services.

Will CVS’ Minute Clinics become the triage for Aetna policy holders before they will be “allowed” to go to a ER ?  There are numerous ways that CVS can put financial incentives/disincentives in place that will very persuasive to pts to go down that path… Hopefully, none of these pts will be more ill than they believe they are and there “condition” is much more severe and life threatening than the pt believed it to be and “waste” critical time getting treatment in a ER because they were trying to take the “less expensive route” ?

3 Responses

  1. I FIND THIS SITUATION TOTALLY INTOLERABLE the financial hold on health care by profit seekers has already had a deadly effect on the level of health care in this country, doctors no longer have the freedom that allows them to make decision based on need rather than the bottom line, they are dictated to and controlled by the bottom line and those who control the bottom line, anyone who thinks this is a good idea needs to have their head examined

    • You are correct unfortunately I’m afraid. A scary private conglomerate that has the life or limb decision making power…..not sure how that’s a benefit to any patients who are not major corporate stakeholders.

  2. This “merger” and any and all future mergers should not be allowed. Pharmacies should stick to what they do best. Filling customer’s prescriptions. I absolutely agree with your concerns, Steve, how this could have a possible negative impact on someone’s health during an event as they try to save money by going to CVS first instead of straight to the ER.

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