12 ms·

CVS Is Said to Agree to Buy Aetna

212 points by jdpedrie 9y ago

rdl 9y ago
If this turns every CVS into a uniform, inexpensive office/urgent care/etc., particularly with telemedicine, I'll be happy -- the "minute clinic" stuff already provides cheaper and more convenient access to care, but CVS+Aetna+some kind of EHR could do something amazing.
- maxerickson 9y ago
  Given that currently around 1 out of 9 locations has a minute clinic that seems unlikely. https://cvshealth.com/about/facts-and-company-information https://cvshealth.com/about/facts-and-company-information When I had Aetna, they didn't even cover getting a flu shot at the pharmacy. Maybe they changed that, but it's dumb, they covered it 100% using primary care.
  - dr_ 9y ago
    I can attest to the fact that Aetna does cover flu shots now.
    - quadrangle 9y ago
      Flu shots are required to be covered in all U.S. insurance per the ACA. The point was that Aetna was requiring the more expensive (for them!) visit to a doctor's office for them to cover it and wouldn't cover it happening at a pharmacy.
      - astura 9y ago
        When I had Atena they did cover pharmacy flu shot but only at one specific pharmacy. It's been years but if my memory serves right think I had to go to CVS to get the flu shot rather than my usual Walgreens.
      - rgbrenner 9y ago
        probably not more expensive for them... to go to your doctors office, you need to make an appointment, take time off work, etc. To go to a pharmacy, you can stop by on your way home or do it on the weekend. By making it inconvenient, you reduce the number of people getting a flu shot... and I would bet that more people drop out from the inconvenience, than the extra amount it costs aetna when you go to the doctors office.
        greenyoda 9y ago
        But if just one of the people insured by Aetna ended up in the hospital due to complications from the flu due to not getting a flu shot, the amount of money they'd have to pay for the hospital stay would pay for hundreds of flu shots.
        deleted 9y ago
        [deleted]
        Consultant32452 9y ago
        The insurance provider doesn't care how much it costs. The ACA states that the insurance provider must spend 80% on services. So as far as they're concerned, the higher the costs of healthcare the more money they get to keep. They just can't let costs skyrocket faster than they're able to increase your premiums.
        quadrangle 9y ago
        The market is a horrible contrivance, and insurance is fundamentally unworkable in a market, unlike actual services and products where you know what you're getting and when you'll need it… But that said, do you have even the tiniest bit of evidence that insurers actually do what you're saying in order to keep their costs up per ACA requirements?? There's all sorts of shenanigans in the industry, but your speculation sounds far-fetched. Remember Hanlon's Razor…
        Consultant32452 9y ago
      - Consultant32452 9y ago
        The ACA states that your insurance provider must spend 80% of their premiums on health care. The doctor is more expensive, so the health insurance provider is allowed to keep more nominal dollars.
        refurb 9y ago
        Although true, I doubt that's the reason since stuff like this was common pre-ACA. The truth is that everything that a payer pays for is done through contracts. Payers will often default to a specific provider because the contract covers it and they don't have a contract for other providers. In terms of the cost, back-end rebates often bring it down. Also, this particular contract may cost more for a flu shot, but save them even more for other procedures.
    - astura 9y ago
      I'm sure Atena has/had a ton of different plans (especially in different states). Theres PPOs, HMOs, POSes, EPOs, high deductible, etc. so any general comments about what Atena does and doesn't cover won't always apply.
  - itissid 9y ago
    And I do like that the pharmacy is next to the docs office.
- mbesto 9y ago
  Aetna is a healthcare payer (or commonly known as a 'carrier') and CVS is a healthcare provider (specifically 'pharmacy') and minute clinic's are also providers (specifically 'care'). Aetna doesn't add any more to the equation of CVS other than streamlining payments. It's only interesting if you use Aetna I guess, but you can generally use CVS pharmacy + minute clinic with your insurance provider today. General high level overview of this: https://www.bcg.com/en-us/industries/health-care-payers-providers/payer-provider-collaboration-vertical-integration.aspx https://www.bcg.com/en-us/industries/health-care-payers-prov...
  - etskinner 9y ago
    Isn't it possible that the two companies being under the same management could have a second-order effect of expanding their Minute Clinic business? That is, because Aetna is part of the same company, it would be less costly for patients to visit MC since the prices that insurance providers usually have to negotiate with providers would go down enormously (to cost + profit instead of cost + MC profit + Aetna profit), thereby bringing more patients into the fold.
    - dd36 9y ago
      That’s only if MC has huge margins, which is doubtful. They already have to negotiate with every carrier.
      - wbl 9y ago
        Vertical integration cuts costs.
        pcurve 9y ago
        costing savings isn't as immediate or apparent as horizontal merger, otherwise more companies would be doing it. Perhaps it makes more sense in space where there are fewer players, but in healthcare as an overall pie is huge.
        mbesto 9y ago
- mrfusion 9y ago
  Is there a good way to do telemedicine now? I can’t get over the awkward factor but if it saves money.
  - just1nn 9y ago
    I have used amwell with great success, recently. I have no affiliation with them, and I am paying them for their services, but my experience was top notch, and I have a PCP through them. I have yet to get my insurance to process automatically, but I just paid with their FSA VISA card and I'm doing an offline bill to submit. Many states REQUIRE covering telemedicine, even for Medicare/Medicaid in some cases.
  - rdl 9y ago
    Telemed from a minute clinic to a specialist is different than telemed from home to a primary care provider. The former is a lot easier to make work.
godzillabrennus 9y ago
Hopefully this helps consumers. I doubt it though. Seems like it’s going to take Jeff Bezos to fix healthcare in America.
- rhizome 9y ago
  Watch out for Engineer's Disease.
  - winslow 9y ago
    Could you elaborate?
    - deleted 9y ago
      [deleted]
    - Karnickel 9y ago
      For example, https://ask.metafilter.com/297591/Origin-of-the-term-Engineers-Disease https://ask.metafilter.com/297591/Origin-of-the-term-Enginee... > ...used to describe engineers and other technical folks assuming their technical knowledge of systems (usually computer, mechanical/electrical) gives them expertise in solving other complex issues. Most of health care is a power/influence and social problem: Who gets to control things, who gets the money, who gets influence over the streams of money through the system? That's not an engineering problem but power play. Even if you _could_ show, using science, that you would get better outcomes with other methods, I don't think the people struggling for the honey pot care. That's why thinking an engineer could build a better health care system seems misguided to me. Better machines to be used as part of the system, sure, but not the system itself. That's politics and hard-core power struggle for the money first of all. If the currently relevant people cared about the health outcomes they would already have changed the system. After all, that "U.S. Spends More on Health Care Than Other High-Income Nations But Has Lower Life Expectancy, Worse Health" (Americans Get Less Health Care, Spend More for It) [0] is not exactly news. [0] http://www.commonwealthfund.org/publications/press-releases/2015/oct/us-spends-more-on-health-care-than-other-nations http://www.commonwealthfund.org/publications/press-releases/...
LeoJiWoo 9y ago
Well I hope this a good thing, and won't lead to price gouging. The trend of corporate consolidation is concerning, we need more monopoly busting, and anti-trust investigations.
- cdolan 9y ago
  I agree the trend is concerning, but what data are you basing the “need” for monopoly busting and anti trust investigations off of??
  - whatshisface 9y ago
    It sounds like he's thinking about all the times this has happened in the past.
  - wfo 9y ago
    Antitrust activities while still provided for in US law have essentially stopped in the modern era, leading to massive concentration of power and economic disasters associated with monopoly and consolidation (e.g. financial crisis). So a general call to bring that job of the federal government back is certainly a welcome one.
IBM 9y ago
A big chunk of the health care industry is the oligopoly of distributors. There's only 3 of them: McKesson, AmerisourceBergen and Cardinal. If Amazon can bring much needed competition to that part of the healthcare market it'd help bring prices down. CVS is moving up the stack because they're afraid of Amazon entering the industry. They're combining a retailer, PBM and now a health insurer. Personally I think it should be blocked because the last thing the health care industry needs is more concentration, but it will likely pass because of the nonsense (Bork-created) antitrust regime of the past 40 years.
- pcurve 9y ago
  Drug distributor is probably the easiest space for Amazon to get into, but it's not where the cost savings opportunities lie. Margin isn't very high in that space. In order for anti trust flag to be raised through vertical integration like this, the combined entity would need to start buying up other entities in the vertical chain. I'm actually interested in how this plays out.
  - IBM 9y ago
    There's excessive concentration at every level of the health care industry. The top 3 PBMs have 80% of the market. Hospitals have consolidated. Doctors practices have consolidated. Consolidation begets consolidation as everyone seeks to increase their leverage over suppliers and customers. If Amazon is going to get into the pharmacy business they'll probably become a distributor as well since it's an outgrowth of the logistics they already do.
    - pcurve 9y ago
      "Hospitals have consolidated" Are you sure about this? Hospital and provider networks are probably the most fragmented layer in the healthcare vertical stack, by far. In the For Profit space, I would agree with you, top 3 dominates. But if you throw in non-profit into mix, their power gets really diluted. https://www.compassphs.com/blog/healthcare-trends/healthcare-fast-facts-top-30-largest-hospital-systems-in-america/ https://www.compassphs.com/blog/healthcare-trends/healthcare...
anilshanbhag 9y ago
Many are questioning if this move will help consumers. I think it will. Aetna is the third largest insurer and CVS is soon to be second largest pharmacy chain. Pharmacies provide basic care at lower cost, many insurance companies are moving Prescription Benefit Managers (PBMs) in-house to lower cost. By combining the two: CVS is able to get more customers for PBM due to Aetna and distribute the cost over a larger base of patients, Aetna maybe be able to reduce costs per customer and better compete with larger insurance firms - its a win-win and a win for consumers.
- aaavl2821 9y ago
  Historically consolidation of any kind in healthcare (hospitals, payers) tends to increase costs to consumers This merger may create value but I'm sure Aetna / CVs will capture as much as possible themselves and consumers will see little of it
- pcurve 9y ago
  I like your optimism. Personally, I don't think this will help consumers, but it won't hurt them either. I think this is more about 1. Leverage. 2. bigger data set on patient and prescribers.
jtedward 9y ago
"Do you have Aetna? No? Would you like to hear about Aetna benefits at CVS? No? That will be a 20% non-Aetna processing fee. Thanks for shopping at CVS, we know you have a choice healthcare, thanks for choosing us."
rsync 9y ago
I feel that perhaps healthcare is the ultimate triumph of capitalism. Every other avenue of runaway consumerism and overconsumption can obviously be pointed to as either indulgent or unnecessary. But not healthcare: it's your health, after all - your wellbeing. It's a fundamental right, right ? ... The received wisdom is that the aging of the baby boomer generation is driving expanded healthcare expenses as this large sect gets older. It's obvious that they need all of this "healthcare". But what if there were an alternative, more insidious explanation: The boomers represent an irresistible pile of money. But they don't smoke. They don't have new households to start. They're getting wise to the whole sugar thing. What is left to tempt them with ? What if there were a clear imperative on the part of a variety of industries to keep this population as unhealthy as possible - so they can stripmine their assets for "healthcare" ?
- deleted 9y ago
  [deleted]
- ams6110 9y ago
  While I doubt your scenario is happening with deliberate intent, I definitely avoid interacting with the "healthcare" industry as much as possible.
- throwaway0255 9y ago
  > The boomers represent an irresistible pile of money. But they don't smoke. They don't have new households to start. They're getting wise to the whole sugar thing. What is left to tempt them with ? > What if there were a clear imperative on the part of a variety of industries to keep this population as unhealthy as possible - so they can stripmine their assets for "healthcare" ? It's not clear that living a healthy lifestyle reduces healthcare costs, it can actually make you more expensive to care for.[1][2][3] Diabetes medications and death from sudden heart attacks are cheap. Healthy people who live into their 80s/90s are the biggest drag on the healthcare system. They spend more of their lives as retirees. They end up needing 24-hour care. And then they still incur the same end-of-life causes as the obese/smokers... they get cancer, they get heart disease, alzheimers, etc. Smokers and obese are inexpensive to care for in terms of lifetime cost. The best-case scenario for an insurance company is that you get hit by a bus or something. Barring that, I think they might actually prefer that you be a smoker or become obese. [1] http://www.telegraph.co.uk/news/health/news/9359212/Obese-and-smokers-less-of-a-burden-on-the-NHS-than-the-healthy-who-live-longer-report.html http://www.telegraph.co.uk/news/health/news/9359212/Obese-an... [2] http://www.nytimes.com/2008/02/05/health/05iht-obese.1.9748884.html http://www.nytimes.com/2008/02/05/health/05iht-obese.1.97488... [3] https://www.forbes.com/sites/timworstall/2012/03/22/alcohol-obesity-and-smoking-do-not-cost-health-care-systems-money/#647df5ab64aa https://www.forbes.com/sites/timworstall/2012/03/22/alcohol-...
bartart 9y ago
Does this mean that many CVSs will become magnets for sick people as CVS tries to integrate more basic health services into its stores? I realize that most people going to an expanded minute clinic aren't going to be some sort of walking dead, but it seems that if CVS tries to make its stores too much like primary care with ill people going to get prescriptions from a doctor, then people will avoid buying things at its stores to avoid getting sick.
- pcurve 9y ago
  Minute clinic facility usually has physical separation from CVS store, no?
  - dangrossman 9y ago
    The one I've seen was just an extra room inside the store, beside the pharmacy. There was no physical separation of patients from shoppers. Same thing at Walgreens Healthcare Clinic, just extra rooms beside the pharmacy.
- dd36 9y ago
  Don’t the walking dead already pick up prescriptions there? I share your concern. Maybe they could service people out of Tesla Semis in the parking lot? Only half joking.
  - briandear 9y ago
    Why do we still have to pick prescriptions up? We have pizza delivery — why not for medicines? Order your drugs with an app and it shows up at your door.
    - Cookiesaurusbex 9y ago
      The VA offers mail delivery for prescription medications. I imagine it has something to do with it being a single payer system, & they have to look for any chance to optimize in the whole medical food chain instead of just the pharmacy portion.
ahh 9y ago
I wonder if this will lead to restrictions on the use of copay coupons [1]. Insurers hate them since they break my incentive to use cheaper drugs from their formulary, but pharmacies don't care (and probably are better off for me using them.) Since I mostly hate my insurer and want to help them towards bankruptcy by extracting as much coverage from my fixed premium as possible, I have no objection to using these coupons if they'd help me and I felt like an expensive drug choice was better for me, though it's not come up for almost any drug I've needed. Though I do need new epi-pens; maybe I should look for one while I still can! [1] https://www.propublica.org/article/are-copay-coupons-actually-making-drugs-more-expensive https://www.propublica.org/article/are-copay-coupons-actuall...
- pcurve 9y ago
  I don't know if insurance company cares whether you use copay coupons or drugs on their formulary as much as your employer does, because they're the one ultimately footing the bill for cost of your meds. Insurance companies and benefit managers try to position them in the middle, so that they would benefit either way.
- Broken_Hippo 9y ago
  That highly depends on your prescription insurance coverage and how much they have to pay compared to the generic. For example, some simply won't cover the brand name if the generic works for you. Others will let you get the brand name, but will only cover the amount they would pay for the generic. In either of these situations, the coupon wouldn't matter to the insurance company. With other plans, though, the insurer pays more with the coupon. And if yours does, you can "stick it to the man" using coupons.
patrickaljord 9y ago
Most HN users who don't live in the US probably don't know what CVS is or care.
- cdelsolar 9y ago
  HN is based in the US.
Something1234 9y ago
All I can say is fuck Aetna. Worst insurance ever, maybe this will make them not be shit. Good luck getting your promised benefits out of them and making it work for you. Every single time I've called them, I get put on hold for 20 minutes, before getting someone who can barely speak English, and the worst part is that their call center is in America.
- perseusprime11 9y ago
  So much for the mindfulness of their ceo: https://www.fiercehealthcare.com/payer/how-aetna-s-bertolini-embraces-mindfulness-to-improve-company-culture https://www.fiercehealthcare.com/payer/how-aetna-s-bertolini...
almostApatriot1 9y ago
I wonder how much this has to do with the strong push for Online Pharmacies over the past decade. I hate using them, but my deductible costs next year have increased so much that I will have no choice.
allenz 9y ago
I see this as a move towards providing cheap basic medical care. This is timely now that it's possible that the individual mandate will be repealed. Millions of uninsured people could be treated for rashes or flus by nurses at CVS cheaper and faster than at doctor's offices. More competition in healthcare could be a good thing--many say it's bloated and overpriced. The risk is that poor people get basic care while rich people get full care, widening health disparities. It's unclear what the new healthcare economics will look like. Currently, minor procedures are profit centers for doctor's offices and hospitals. They subsidize complicated patients (often elderly with multiple chronic diseases like diabetes or COPD) who are riskier and take more time to treat. If CVS is taking that money, then hospitals may need to do some cost-cutting.
- deleted 9y ago
  [deleted]
- jrnichols 9y ago
  > treated for rashes or flus by nurses I sometimes think that's one of the things that's kept health care so expensive. Nursing salaries aren't cheap. A lot of the home health and basic clinic stuff could be handled by an LPN/LVN or even a Paramedic in many cases. Not everything needs an RN. There are plenty of available telemedicine options to put a provider in touch with a higher level of care if necessary.
  - afpx 9y ago
    Or, the high price may be from administrative costs: http://www.nejm.org/doi/full/10.1056/NEJMp1209711 http://www.nejm.org/doi/full/10.1056/NEJMp1209711
    - refurb 9y ago
      Do a search for "McKinsey health costs" and browse the report. It breaks down category spending in the US vs. other western countries. Yes, admin cost more in the US, but it doesn't add much to the overall costs. The biggest driver of US healthcare spending are out-patient care. The US just does a shit-ton more of it then most countries.
gigatexal 9y ago
Um wtf. This is akin to comcast buying NBC. This is not good.
- jdpedrie 9y ago
  Can you identify any tangible negative effects on consumers which arose due to the purchase of NBC by Comcast?
  - gigatexal 9y ago
    No. But the potential is there. They were better off separate as they operated as different entities but together their incentives are overlapped and the potential to exert undue power over the market is that much easier. Separate Comcast and NBC had no incentive to go into any exclusive agreements. Disney buying Marvel is a similar case. They are pulling content licensed for viewing on Netflix into their own service. Not illegal but not a win for consumers in an already crowded steaming market. And unfair to Netflix in that sense.
- phkahler 9y ago
  Thank you, the top comment and all its follow-up seem to think it's a good thing and may lower cost. It's hard for me to imagine this being anything less than a way to make more money with the combined companies.
  - sithadmin 9y ago
    Of course it's a way to make more money. They wouldn't move forward with this deal if it wasn't. But this doesn't preclude the possibility that end result will be a more efficient, vertically integrated healthcare provider.
  - WWLink 9y ago
    It's terrible! The best doctors I've ever had were private practices where they had their own office. Every time I've dealt with anything remotely corporate it was a nightmare.
exabrial 9y ago
Reminds me of the quote "There is no way to do CVS correctly..."
m3kw9 9y ago
I see CVS using this to defend Amazon by giving Aetna customers with store discounts
ikeboy 9y ago
>Both CVS and Aetna played down the prospects of regulators moving to block their deal. The breakup fee for the transaction is not especially large, reflecting that belief. What's the causality here? Why does a lower chance of being blocked imply a lower fee if blocked?
- erebus_rex 9y ago
  Takeovers cost time and money to execute (lawyers, consultants, bank fees) beyond just the purchases price. If the deal does not go through it is a loss for the acquirer, hence breakup fees. If the chance of takeover failure is low the acquirer will be willing to accept a smaller insurance.
  - ikeboy 9y ago
    The fee is only paid if it doesn't go through. So I still fail to see how that reflects the chance of success.
ropeladder 9y ago
The only real upside I see here is that, the more vertically and horizontally concentrated the private sector gets, the more absurd most arguments for privatized, profit-driven healthcare appear. Basically every other developed country has shown that the government can do as good of a job at half the cost. Socialize it all.
- throwaway13337 9y ago
  I agree in spirit but I'd also point out that our public spending on health care is already at about the same costs as western counties with socialized medicine. [1] Our tax dollars are already paying out as much as other countries do but their citizens get a lot more for their money. The solution to lowering the cost of medicine in the US has not a single solution but lies at every level of the system. [1] https://www.oecd.org/health/health-systems/Focus-Health-Spending-2015.pdf https://www.oecd.org/health/health-systems/Focus-Health-Spen... - it's the second chart.
  - peg_leg 9y ago
    Much of what we pay goes to Profit on several levels - insurance, provider, and medications, et al. That's where the American waste is.
- deleted 9y ago
  [deleted]
ulfw 9y ago
The monopolisation of American industry continues.
drawkbox 9y ago
It is a consolidation but CVS is a consumer focused company, which is something the US Healthcare system needs more of direly. Part of the problem with health insurance tied to a job in the US is the fixed market that is shrouded from consumers leading to horrible pricing and service. Employment handling healthcare, in addition to a fixed pricing market, also harms the individual market due to horrible grouping, invades privacy, makes it harder to change jobs or start a company, and on top of that fuels ageism as costs go up with age in health. Employers should have no part in your healthcare, pay people more to go get it is all that should be allowed. All other insurance types are consumer focused for auto, life, home and more. CVS taking over Aetna could be a great force in the market to make other companies get competitive on the consumer front. Aetna and BCBS are two of the worse non consumer friendly insurers around, they really hate dealing with individuals and small companies.
SockPuppeteer 9y ago
They should break up the big insurance companies and not consolidate each point of sale area for more profit. Ex: A knee brace went over the $500 requirement to have a prior approval before issuance. No one knew this at the time so the doctor gave a cost price of $100 for the brace to avoid phone calls, letters, and time. Can we please eliminate medical bills if not sent to the patient within 90 days? 2-5 years late is just pathetic.
cjhanks 9y ago
When will SVN buy Cigna?

212 points by jdpedrie 9y ago

rdl 9y ago

If this turns every CVS into a uniform, inexpensive office/urgent care/etc., particularly with telemedicine, I'll be happy -- the "minute clinic" stuff already provides cheaper and more convenient access to care, but CVS+Aetna+some kind of EHR could do something amazing.

maxerickson 9y ago
Given that currently around 1 out of 9 locations has a minute clinic that seems unlikely. https://cvshealth.com/about/facts-and-company-information https://cvshealth.com/about/facts-and-company-information When I had Aetna, they didn't even cover getting a flu shot at the pharmacy. Maybe they changed that, but it's dumb, they covered it 100% using primary care.
- dr_ 9y ago
  I can attest to the fact that Aetna does cover flu shots now.
  - quadrangle 9y ago
    Flu shots are required to be covered in all U.S. insurance per the ACA. The point was that Aetna was requiring the more expensive (for them!) visit to a doctor's office for them to cover it and wouldn't cover it happening at a pharmacy.
    - astura 9y ago
      When I had Atena they did cover pharmacy flu shot but only at one specific pharmacy. It's been years but if my memory serves right think I had to go to CVS to get the flu shot rather than my usual Walgreens.
    - rgbrenner 9y ago
      probably not more expensive for them... to go to your doctors office, you need to make an appointment, take time off work, etc. To go to a pharmacy, you can stop by on your way home or do it on the weekend. By making it inconvenient, you reduce the number of people getting a flu shot... and I would bet that more people drop out from the inconvenience, than the extra amount it costs aetna when you go to the doctors office.
      - greenyoda 9y ago
        But if just one of the people insured by Aetna ended up in the hospital due to complications from the flu due to not getting a flu shot, the amount of money they'd have to pay for the hospital stay would pay for hundreds of flu shots.
        deleted 9y ago
        [deleted]
        Consultant32452 9y ago
        The insurance provider doesn't care how much it costs. The ACA states that the insurance provider must spend 80% on services. So as far as they're concerned, the higher the costs of healthcare the more money they get to keep. They just can't let costs skyrocket faster than they're able to increase your premiums.
        quadrangle 9y ago
        The market is a horrible contrivance, and insurance is fundamentally unworkable in a market, unlike actual services and products where you know what you're getting and when you'll need it… But that said, do you have even the tiniest bit of evidence that insurers actually do what you're saying in order to keep their costs up per ACA requirements?? There's all sorts of shenanigans in the industry, but your speculation sounds far-fetched. Remember Hanlon's Razor…
        Consultant32452 9y ago
    - Consultant32452 9y ago
      The ACA states that your insurance provider must spend 80% of their premiums on health care. The doctor is more expensive, so the health insurance provider is allowed to keep more nominal dollars.
      - refurb 9y ago
        Although true, I doubt that's the reason since stuff like this was common pre-ACA. The truth is that everything that a payer pays for is done through contracts. Payers will often default to a specific provider because the contract covers it and they don't have a contract for other providers. In terms of the cost, back-end rebates often bring it down. Also, this particular contract may cost more for a flu shot, but save them even more for other procedures.
  - astura 9y ago
    I'm sure Atena has/had a ton of different plans (especially in different states). Theres PPOs, HMOs, POSes, EPOs, high deductible, etc. so any general comments about what Atena does and doesn't cover won't always apply.
- itissid 9y ago
  And I do like that the pharmacy is next to the docs office.
mbesto 9y ago
Aetna is a healthcare payer (or commonly known as a 'carrier') and CVS is a healthcare provider (specifically 'pharmacy') and minute clinic's are also providers (specifically 'care'). Aetna doesn't add any more to the equation of CVS other than streamlining payments. It's only interesting if you use Aetna I guess, but you can generally use CVS pharmacy + minute clinic with your insurance provider today. General high level overview of this: https://www.bcg.com/en-us/industries/health-care-payers-providers/payer-provider-collaboration-vertical-integration.aspx https://www.bcg.com/en-us/industries/health-care-payers-prov...
- etskinner 9y ago
  Isn't it possible that the two companies being under the same management could have a second-order effect of expanding their Minute Clinic business? That is, because Aetna is part of the same company, it would be less costly for patients to visit MC since the prices that insurance providers usually have to negotiate with providers would go down enormously (to cost + profit instead of cost + MC profit + Aetna profit), thereby bringing more patients into the fold.
  - dd36 9y ago
    That’s only if MC has huge margins, which is doubtful. They already have to negotiate with every carrier.
    - wbl 9y ago
      Vertical integration cuts costs.
      - pcurve 9y ago
        costing savings isn't as immediate or apparent as horizontal merger, otherwise more companies would be doing it. Perhaps it makes more sense in space where there are fewer players, but in healthcare as an overall pie is huge.
      - mbesto 9y ago
mrfusion 9y ago
Is there a good way to do telemedicine now? I can’t get over the awkward factor but if it saves money.
- just1nn 9y ago
  I have used amwell with great success, recently. I have no affiliation with them, and I am paying them for their services, but my experience was top notch, and I have a PCP through them. I have yet to get my insurance to process automatically, but I just paid with their FSA VISA card and I'm doing an offline bill to submit. Many states REQUIRE covering telemedicine, even for Medicare/Medicaid in some cases.
- rdl 9y ago
  Telemed from a minute clinic to a specialist is different than telemed from home to a primary care provider. The former is a lot easier to make work.

godzillabrennus 9y ago

Hopefully this helps consumers. I doubt it though. Seems like it’s going to take Jeff Bezos to fix healthcare in America.

rhizome 9y ago
Watch out for Engineer's Disease.
- winslow 9y ago
  Could you elaborate?
  - deleted 9y ago
    [deleted]
  - Karnickel 9y ago
    For example, https://ask.metafilter.com/297591/Origin-of-the-term-Engineers-Disease https://ask.metafilter.com/297591/Origin-of-the-term-Enginee... > ...used to describe engineers and other technical folks assuming their technical knowledge of systems (usually computer, mechanical/electrical) gives them expertise in solving other complex issues. Most of health care is a power/influence and social problem: Who gets to control things, who gets the money, who gets influence over the streams of money through the system? That's not an engineering problem but power play. Even if you _could_ show, using science, that you would get better outcomes with other methods, I don't think the people struggling for the honey pot care. That's why thinking an engineer could build a better health care system seems misguided to me. Better machines to be used as part of the system, sure, but not the system itself. That's politics and hard-core power struggle for the money first of all. If the currently relevant people cared about the health outcomes they would already have changed the system. After all, that "U.S. Spends More on Health Care Than Other High-Income Nations But Has Lower Life Expectancy, Worse Health" (Americans Get Less Health Care, Spend More for It) [0] is not exactly news. [0] http://www.commonwealthfund.org/publications/press-releases/2015/oct/us-spends-more-on-health-care-than-other-nations http://www.commonwealthfund.org/publications/press-releases/...

LeoJiWoo 9y ago

Well I hope this a good thing, and won't lead to price gouging. The trend of corporate consolidation is concerning, we need more monopoly busting, and anti-trust investigations.

cdolan 9y ago
I agree the trend is concerning, but what data are you basing the “need” for monopoly busting and anti trust investigations off of??
- whatshisface 9y ago
  It sounds like he's thinking about all the times this has happened in the past.
- wfo 9y ago
  Antitrust activities while still provided for in US law have essentially stopped in the modern era, leading to massive concentration of power and economic disasters associated with monopoly and consolidation (e.g. financial crisis). So a general call to bring that job of the federal government back is certainly a welcome one.

IBM 9y ago

A big chunk of the health care industry is the oligopoly of distributors. There's only 3 of them: McKesson, AmerisourceBergen and Cardinal. If Amazon can bring much needed competition to that part of the healthcare market it'd help bring prices down. CVS is moving up the stack because they're afraid of Amazon entering the industry. They're combining a retailer, PBM and now a health insurer. Personally I think it should be blocked because the last thing the health care industry needs is more concentration, but it will likely pass because of the nonsense (Bork-created) antitrust regime of the past 40 years.

pcurve 9y ago
Drug distributor is probably the easiest space for Amazon to get into, but it's not where the cost savings opportunities lie. Margin isn't very high in that space. In order for anti trust flag to be raised through vertical integration like this, the combined entity would need to start buying up other entities in the vertical chain. I'm actually interested in how this plays out.
- IBM 9y ago
  There's excessive concentration at every level of the health care industry. The top 3 PBMs have 80% of the market. Hospitals have consolidated. Doctors practices have consolidated. Consolidation begets consolidation as everyone seeks to increase their leverage over suppliers and customers. If Amazon is going to get into the pharmacy business they'll probably become a distributor as well since it's an outgrowth of the logistics they already do.
  - pcurve 9y ago
    "Hospitals have consolidated" Are you sure about this? Hospital and provider networks are probably the most fragmented layer in the healthcare vertical stack, by far. In the For Profit space, I would agree with you, top 3 dominates. But if you throw in non-profit into mix, their power gets really diluted. https://www.compassphs.com/blog/healthcare-trends/healthcare-fast-facts-top-30-largest-hospital-systems-in-america/ https://www.compassphs.com/blog/healthcare-trends/healthcare...

anilshanbhag 9y ago

Many are questioning if this move will help consumers. I think it will. Aetna is the third largest insurer and CVS is soon to be second largest pharmacy chain. Pharmacies provide basic care at lower cost, many insurance companies are moving Prescription Benefit Managers (PBMs) in-house to lower cost. By combining the two: CVS is able to get more customers for PBM due to Aetna and distribute the cost over a larger base of patients, Aetna maybe be able to reduce costs per customer and better compete with larger insurance firms - its a win-win and a win for consumers.

aaavl2821 9y ago
Historically consolidation of any kind in healthcare (hospitals, payers) tends to increase costs to consumers This merger may create value but I'm sure Aetna / CVs will capture as much as possible themselves and consumers will see little of it
pcurve 9y ago
I like your optimism. Personally, I don't think this will help consumers, but it won't hurt them either. I think this is more about 1. Leverage. 2. bigger data set on patient and prescribers.

jtedward 9y ago

"Do you have Aetna? No? Would you like to hear about Aetna benefits at CVS? No? That will be a 20% non-Aetna processing fee. Thanks for shopping at CVS, we know you have a choice healthcare, thanks for choosing us."

rsync 9y ago

I feel that perhaps healthcare is the ultimate triumph of capitalism. Every other avenue of runaway consumerism and overconsumption can obviously be pointed to as either indulgent or unnecessary. But not healthcare: it's your health, after all - your wellbeing. It's a fundamental right, right ? ... The received wisdom is that the aging of the baby boomer generation is driving expanded healthcare expenses as this large sect gets older. It's obvious that they need all of this "healthcare". But what if there were an alternative, more insidious explanation: The boomers represent an irresistible pile of money. But they don't smoke. They don't have new households to start. They're getting wise to the whole sugar thing. What is left to tempt them with ? What if there were a clear imperative on the part of a variety of industries to keep this population as unhealthy as possible - so they can stripmine their assets for "healthcare" ?

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ams6110 9y ago
While I doubt your scenario is happening with deliberate intent, I definitely avoid interacting with the "healthcare" industry as much as possible.
throwaway0255 9y ago
> The boomers represent an irresistible pile of money. But they don't smoke. They don't have new households to start. They're getting wise to the whole sugar thing. What is left to tempt them with ? > What if there were a clear imperative on the part of a variety of industries to keep this population as unhealthy as possible - so they can stripmine their assets for "healthcare" ? It's not clear that living a healthy lifestyle reduces healthcare costs, it can actually make you more expensive to care for.[1][2][3] Diabetes medications and death from sudden heart attacks are cheap. Healthy people who live into their 80s/90s are the biggest drag on the healthcare system. They spend more of their lives as retirees. They end up needing 24-hour care. And then they still incur the same end-of-life causes as the obese/smokers... they get cancer, they get heart disease, alzheimers, etc. Smokers and obese are inexpensive to care for in terms of lifetime cost. The best-case scenario for an insurance company is that you get hit by a bus or something. Barring that, I think they might actually prefer that you be a smoker or become obese. [1] http://www.telegraph.co.uk/news/health/news/9359212/Obese-and-smokers-less-of-a-burden-on-the-NHS-than-the-healthy-who-live-longer-report.html http://www.telegraph.co.uk/news/health/news/9359212/Obese-an... [2] http://www.nytimes.com/2008/02/05/health/05iht-obese.1.9748884.html http://www.nytimes.com/2008/02/05/health/05iht-obese.1.97488... [3] https://www.forbes.com/sites/timworstall/2012/03/22/alcohol-obesity-and-smoking-do-not-cost-health-care-systems-money/#647df5ab64aa https://www.forbes.com/sites/timworstall/2012/03/22/alcohol-...

bartart 9y ago

Does this mean that many CVSs will become magnets for sick people as CVS tries to integrate more basic health services into its stores? I realize that most people going to an expanded minute clinic aren't going to be some sort of walking dead, but it seems that if CVS tries to make its stores too much like primary care with ill people going to get prescriptions from a doctor, then people will avoid buying things at its stores to avoid getting sick.

pcurve 9y ago
Minute clinic facility usually has physical separation from CVS store, no?
- dangrossman 9y ago
  The one I've seen was just an extra room inside the store, beside the pharmacy. There was no physical separation of patients from shoppers. Same thing at Walgreens Healthcare Clinic, just extra rooms beside the pharmacy.
dd36 9y ago
Don’t the walking dead already pick up prescriptions there? I share your concern. Maybe they could service people out of Tesla Semis in the parking lot? Only half joking.
- briandear 9y ago
  Why do we still have to pick prescriptions up? We have pizza delivery — why not for medicines? Order your drugs with an app and it shows up at your door.
  - Cookiesaurusbex 9y ago
    The VA offers mail delivery for prescription medications. I imagine it has something to do with it being a single payer system, & they have to look for any chance to optimize in the whole medical food chain instead of just the pharmacy portion.

ahh 9y ago

I wonder if this will lead to restrictions on the use of copay coupons [1]. Insurers hate them since they break my incentive to use cheaper drugs from their formulary, but pharmacies don't care (and probably are better off for me using them.) Since I mostly hate my insurer and want to help them towards bankruptcy by extracting as much coverage from my fixed premium as possible, I have no objection to using these coupons if they'd help me and I felt like an expensive drug choice was better for me, though it's not come up for almost any drug I've needed. Though I do need new epi-pens; maybe I should look for one while I still can! [1] https://www.propublica.org/article/are-copay-coupons-actually-making-drugs-more-expensive https://www.propublica.org/article/are-copay-coupons-actuall...

pcurve 9y ago
I don't know if insurance company cares whether you use copay coupons or drugs on their formulary as much as your employer does, because they're the one ultimately footing the bill for cost of your meds. Insurance companies and benefit managers try to position them in the middle, so that they would benefit either way.
Broken_Hippo 9y ago
That highly depends on your prescription insurance coverage and how much they have to pay compared to the generic. For example, some simply won't cover the brand name if the generic works for you. Others will let you get the brand name, but will only cover the amount they would pay for the generic. In either of these situations, the coupon wouldn't matter to the insurance company. With other plans, though, the insurer pays more with the coupon. And if yours does, you can "stick it to the man" using coupons.

patrickaljord 9y ago

Most HN users who don't live in the US probably don't know what CVS is or care.

cdelsolar 9y ago
HN is based in the US.

Something1234 9y ago

All I can say is fuck Aetna. Worst insurance ever, maybe this will make them not be shit. Good luck getting your promised benefits out of them and making it work for you. Every single time I've called them, I get put on hold for 20 minutes, before getting someone who can barely speak English, and the worst part is that their call center is in America.

perseusprime11 9y ago
So much for the mindfulness of their ceo: https://www.fiercehealthcare.com/payer/how-aetna-s-bertolini-embraces-mindfulness-to-improve-company-culture https://www.fiercehealthcare.com/payer/how-aetna-s-bertolini...

almostApatriot1 9y ago

I wonder how much this has to do with the strong push for Online Pharmacies over the past decade. I hate using them, but my deductible costs next year have increased so much that I will have no choice.

allenz 9y ago

I see this as a move towards providing cheap basic medical care. This is timely now that it's possible that the individual mandate will be repealed. Millions of uninsured people could be treated for rashes or flus by nurses at CVS cheaper and faster than at doctor's offices. More competition in healthcare could be a good thing--many say it's bloated and overpriced. The risk is that poor people get basic care while rich people get full care, widening health disparities. It's unclear what the new healthcare economics will look like. Currently, minor procedures are profit centers for doctor's offices and hospitals. They subsidize complicated patients (often elderly with multiple chronic diseases like diabetes or COPD) who are riskier and take more time to treat. If CVS is taking that money, then hospitals may need to do some cost-cutting.

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jrnichols 9y ago
> treated for rashes or flus by nurses I sometimes think that's one of the things that's kept health care so expensive. Nursing salaries aren't cheap. A lot of the home health and basic clinic stuff could be handled by an LPN/LVN or even a Paramedic in many cases. Not everything needs an RN. There are plenty of available telemedicine options to put a provider in touch with a higher level of care if necessary.
- afpx 9y ago
  Or, the high price may be from administrative costs: http://www.nejm.org/doi/full/10.1056/NEJMp1209711 http://www.nejm.org/doi/full/10.1056/NEJMp1209711
  - refurb 9y ago
    Do a search for "McKinsey health costs" and browse the report. It breaks down category spending in the US vs. other western countries. Yes, admin cost more in the US, but it doesn't add much to the overall costs. The biggest driver of US healthcare spending are out-patient care. The US just does a shit-ton more of it then most countries.

gigatexal 9y ago

Um wtf. This is akin to comcast buying NBC. This is not good.

jdpedrie 9y ago
Can you identify any tangible negative effects on consumers which arose due to the purchase of NBC by Comcast?
- gigatexal 9y ago
  No. But the potential is there. They were better off separate as they operated as different entities but together their incentives are overlapped and the potential to exert undue power over the market is that much easier. Separate Comcast and NBC had no incentive to go into any exclusive agreements. Disney buying Marvel is a similar case. They are pulling content licensed for viewing on Netflix into their own service. Not illegal but not a win for consumers in an already crowded steaming market. And unfair to Netflix in that sense.
phkahler 9y ago
Thank you, the top comment and all its follow-up seem to think it's a good thing and may lower cost. It's hard for me to imagine this being anything less than a way to make more money with the combined companies.
- sithadmin 9y ago
  Of course it's a way to make more money. They wouldn't move forward with this deal if it wasn't. But this doesn't preclude the possibility that end result will be a more efficient, vertically integrated healthcare provider.
- WWLink 9y ago
  It's terrible! The best doctors I've ever had were private practices where they had their own office. Every time I've dealt with anything remotely corporate it was a nightmare.

exabrial 9y ago

Reminds me of the quote "There is no way to do CVS correctly..."

m3kw9 9y ago

I see CVS using this to defend Amazon by giving Aetna customers with store discounts

ikeboy 9y ago

>Both CVS and Aetna played down the prospects of regulators moving to block their deal. The breakup fee for the transaction is not especially large, reflecting that belief. What's the causality here? Why does a lower chance of being blocked imply a lower fee if blocked?

erebus_rex 9y ago
Takeovers cost time and money to execute (lawyers, consultants, bank fees) beyond just the purchases price. If the deal does not go through it is a loss for the acquirer, hence breakup fees. If the chance of takeover failure is low the acquirer will be willing to accept a smaller insurance.
- ikeboy 9y ago
  The fee is only paid if it doesn't go through. So I still fail to see how that reflects the chance of success.

ropeladder 9y ago

The only real upside I see here is that, the more vertically and horizontally concentrated the private sector gets, the more absurd most arguments for privatized, profit-driven healthcare appear. Basically every other developed country has shown that the government can do as good of a job at half the cost. Socialize it all.

throwaway13337 9y ago
I agree in spirit but I'd also point out that our public spending on health care is already at about the same costs as western counties with socialized medicine. [1] Our tax dollars are already paying out as much as other countries do but their citizens get a lot more for their money. The solution to lowering the cost of medicine in the US has not a single solution but lies at every level of the system. [1] https://www.oecd.org/health/health-systems/Focus-Health-Spending-2015.pdf https://www.oecd.org/health/health-systems/Focus-Health-Spen... - it's the second chart.
- peg_leg 9y ago
  Much of what we pay goes to Profit on several levels - insurance, provider, and medications, et al. That's where the American waste is.
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ulfw 9y ago

The monopolisation of American industry continues.

drawkbox 9y ago

It is a consolidation but CVS is a consumer focused company, which is something the US Healthcare system needs more of direly. Part of the problem with health insurance tied to a job in the US is the fixed market that is shrouded from consumers leading to horrible pricing and service. Employment handling healthcare, in addition to a fixed pricing market, also harms the individual market due to horrible grouping, invades privacy, makes it harder to change jobs or start a company, and on top of that fuels ageism as costs go up with age in health. Employers should have no part in your healthcare, pay people more to go get it is all that should be allowed. All other insurance types are consumer focused for auto, life, home and more. CVS taking over Aetna could be a great force in the market to make other companies get competitive on the consumer front. Aetna and BCBS are two of the worse non consumer friendly insurers around, they really hate dealing with individuals and small companies.

SockPuppeteer 9y ago

They should break up the big insurance companies and not consolidate each point of sale area for more profit. Ex: A knee brace went over the $500 requirement to have a prior approval before issuance. No one knew this at the time so the doctor gave a cost price of $100 for the brace to avoid phone calls, letters, and time. Can we please eliminate medical bills if not sent to the patient within 90 days? 2-5 years late is just pathetic.

cjhanks 9y ago

When will SVN buy Cigna?