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What will the CVS merger with Aetna mean for the consumer?

2 On Your Side: CVS Aetna Merger. What will the CVS merger with Aetna mean for the consumer? Kristine Lazar reports.

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The plan for pharmacy company CVS Health to buy health insurance giant Aetna could not only set a record as the largest American health insurance deal in history, it could change the way you get health checkups or see a doctor when you're sick.

The $69 billion acquisition -- $77 billion including Aetna's debt -- could "remake the consumer health care experience," said Larry J. Merlo, CVS Health's president and chief executive officer, in a news release Sunday.

CVS has more than 9,700 pharmacy locations and more than 1,100 walk-in health care clinicsacross the United States, offering health screenings, vaccinations, lab tests and treatment for common illnesses or injuries.

CVS also owns the pharmacy benefits manager and mail order pharmacy Caremark.

Merging CVS operations with Aetna could mean you see a shift in health care costs, where you're treated for emergency injuries or how often you visit your doctor -- and we could see more of such mergers in the future. For Aetna customers, it remains unclear just how quickly they might start seeing such changes.

If approved by shareholders and regulators, the deal is expected to be done in the second half of 2018, according to the announcement. Here are four ways a merger might transform health care for some people.

All eyes on drug costs

"I think the important thing for consumers to look out for going forward is how prices are likely to change," said Amanda Starc, an associate professor at Northwestern University's Kellogg School of Management, who is not involved in the CVS-Aetna merger but whose research interests include health economics.

"Everyone's been concerned about rising drug prices, and the question is, 'Will a merger like this help slow that trend?' " she said. "I don't think that we have a good sense of which way that's likely to go."

In a conference call with analysts on Monday, Merlo said that rising health care costs are a major problem for consumers and that the combination of CVS and Aetna will lead to lower expensesand better service for their patients and health care providers.

In other words, "your insurance company now cares not just what you're spending on drugs but what you're spending on overall medical utilization," Starc said.

"It could be the case that they might design your benefits in a way that makes it cheaper for you to do things like fill your asthma drugs or your blood pressure medication, those types of drugs that are likely to keep you out of the hospital," she said. "That could be very beneficial for consumer health."

On the other hand, if Aetna customers' pharmacy benefit provider and pharmacy services provider merge, it could be difficult for them to go outside their network for pharmacy benefits, and their pharmacy options could diminish, said Dr. Michael Williams, an associate professor of surgery at the University of Virginia and director of its Center for Health Policy, who is not involved in the merger.

A 'double-edged sword' when it comes to options

Consumers might find they have fewer choices about where they can get services, or what they'll pay -- but those services might be more convenient.

"Certainly, if I was CVS and was in the end paying for Aetna's services, I would limit as much as I can from which pharmacy you can get your medication," said Williams, who is insured through Aetna and has treated Aetna-insured patients.

"The pricing will be one that is going to change for the patient," he said. "The reality for the average consumer is that the number of choices that you're going to have if you're already insured with Aetna ... will probably diminish."

This aspect of the CVS-Aetna merger could impact prescription services as well as health services provided in CVS walk-in clinics. Overall, it seems to present a double-edged sword in the health care marketplace for consumers, Williams said.

"I think there's going to be greater convenience and ease of use for obtaining health services, because I think there's going to be more and more CVS pharmacies, which are ubiquitous, that are a place and endpoint where you can access health care," Williams said.

"The other side of the sword, though, is that they will be able to dictate fees. They will tell you what medications they will cover, and your ability to therefore say 'well, I need to get access to this kind of insulin or that kind of chemotherapy' is going to diminish," he said. "Your ability to seek other options will be constrained, so that's a double-edged sword."

Minute Clinics could replace emergency rooms

The CVS-Aetna merger could eliminate much of the "unnecessary complexities" consumers face when seeing a doctor and create a "new front door to the health care system," Aetna CEO Mark Bertolini said in the conference call Monday.

For instance, a pharmacy or Minute Clinic could be a first option of care for sick patients instead of a hectic emergency room. While Minute Clinics certainly have not replaced emergency rooms yet, some experts suspect that more clinics are expected to emerge and might aim to fill that role.

"The hope would be that you'd go to the Minute Clinic instead of going to the ER," Starc said.

"I think the effects of that are likely to be actually quite small in the grand scheme of things," she said. "Nonetheless, you can imagine that being a nice ancillary benefit."

Health records from visits to clinics, pharmacies and doctors all could be more easily integrated into a patient's file, Williams said.

Having a more integrated system makes it easier for doctors to treat a patient as well as to monitor their health status and care, he said.

"If Aetna will maintain a health record of those encounters, now there's a chance for that information to be part of a larger system view for each patient and groups of patients," Williams said.

"So there's a potential upside for us if Aetna does this correctly," he said. "Right now, if you go to Minute Clinic as one of my patients, unless you tell me, I have no way of knowing."

Doctor's office visits could be less necessary

Those combined services that CVS and Aetna could provide in pharmacies and clinics could make not only visits to the hospital but visits to a primary care physician's office less necessary.

Aetna's Bertolini said the combined resources of CVS and Aetna could make pharmacies and walk-in clinics kind of like the medical version of the Genius Bar at Apple Stores, with experts dispensing quick, convenient and reliable health care knowledge.

"I think that we're going to see the growth of more and more clinics where health services are being provided in the CVS footprint geographically," Williams said. "So if there isn't a clinic already in your CVS, I think one is coming to a CVS near you in the near-term future."


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