Tag Archives: merger

Why LI Hospital Mergers make it harder…

A recent article in Newsday points out that there is only 1 independent hospital left on the island – Brookhaven Medical Center, now know as the Long Island Medical Center.

“Hospitals are combining nationwide. There were 78 hospital deals in the United States in 2017, in which 216 hospitals, with a total of 27,386 beds, were acquired, said Lisa Phillips, editor of HealthCareMandA.com, a publication that tracks health care mergers for health care consultant Irving Levin Associates in Norwalk, Connecticut…   In the New York metropolitan area, New Hyde Park-based Northwell Health, the most aggressive acquirer on Long Island, has expanded its network into Brooklyn, Westchester County and eastern Long Island by taking over hospitals. It has added four hospitals in the past 3 1⁄2 years.”

This has made it hard on patients – especially those on ObamaCare individual policies – to find insurance that covers their doctors.  Northwell does not have a relationship with Oscar Health Plans, the most affordable of the options.  Some hospitals simply refuse to accept the reimbursement rates of the individual plans as well.   NYU Hospitals don’t have relationships with Healthfirst either.  If you live in Nassau County, you are more or less forced into expensive options – Empire and Emblem.

I believe it likely that we will see some changes to this during the year, but only time will tell.  And any midyear changes don’t help you this year, since you cannot change until January 1…

CIGNA to acquire ExpressScripts

After CVS agreed to acquire insurer Aetna, CIGNA has agreed to purchase express scripts for $67 billion.  Express Scripts is the largest pharmacy benefit manager (PBM) in the country.  This continues the remake of the nations healthcare system through merger and acquisition:

 

“Aetna and CVS have said they hope to create “front doors” to healthcare through 9,800 stores run by CVS. That deal could turn many of the chain’s stores into one-stop-shop locations for an array of healthcare needs like blood work and eye or hearing care, in addition to their traditional role of filling prescriptions.

UnitedHealth Group Inc., which runs the nation’s largest insurer, is spending almost $5 billion to buy nearly 300 primary and specialty care clinics and some urgent care and surgery centres. That push will help the company steer patients away from expensive hospital care.

Another insurer, Humana Inc., is making a separate deal to better manage the care of its Medicare Advantage patients.”

CVS Agrees To Buy Health Insurance Giant Aetna

The pharmacy chain CVS Health has agreed to buy Aetna in a $69 billion deal that could transform the health care industry. If the deal, which was announced by the two companies on Sunday, is approved by regulators, it would bring a large health insurance company and pharmacy provider under one umbrella.

The agreement is expected to close in the second half of 2018. The terms of the merger agreement were approved by the board of directors of both companies on Sunday.

“This transaction fills an unmet need in the current health care system and presents a unique opportunity to redefine access to high-quality care in lower cost, local settings whether in the community, at home, or through digital tools,” the two companies said in a joint announcement.

In the statement, the companies said they will become a trusted community partner who will help consumers better manage the cost of the health care they need.

As part of the deal, CVS plans to use its pharmacy locations to provide consumers with “community health-hubs” where patients can get answers to questions about their health, prescription drugs and health coverage. Pharmacy locations will also includes space for wellness, clinical and pharmacy services, vision, hearing, nutrition, beauty, and medical equipment.

The two companies touted the merger as a better opportunity to utilize local care solutions by connecting Aetna with greater consumer access through CVS’ 9,700 pharmacies and 1,100 MinuteClinic walk-in clinics. By connecting patients with community health-hubs, the companies say it will help them reduce hospital readmission costs as patients can stop at these local facilities to assess their needs.

Several news reports on the deal note that a big driving factor in the acquisition is potential competition from Amazon as it seeks to enter the pharmacy market. Corporations from all industries are dealing with the threat of Amazon and most recently the e-commerce giant entered the grocery business with its acquisition of Whole Foods.

Cigna Anthem Merger may not get done

FROM LIFEHEALTHPRO:

Bloomberg) — Cigna Corp.’s acquisition by health-insurance rival Anthem (NYSE:ANTM) may not be approved this year, Cigna (NYSE:CI) said Friday in a regulatory filing.

Shares of both companies declined. An analyst said the delay could be a sign of trouble for the deal, which is one of two pending health insurance combinations being scrutinized by regulators. Regulators have expressed concern about further concentration of the health care industry.

“While the company continues to work toward achieving regulatory approval as quickly as possible and to target a closing date in the second half of 2016, the closing will ultimately be subject to the approval and timing of the regulators,” Cigna said in a quarterly report filed with the U.S. Securities and Exchange Commission (SEC). “In light of the complexity of the regulatory process and the dynamic environment, it is possible that such approvals may not be obtained in 2016.”

Joseph Swedish, Anthem’s chief executive officer, said last week that he expected the acquisition of Cigna to be completed in the second half of this year. On Friday, Jill Becher, an Anthem spokeswoman, said the insurer continued to expect the transaction to be completed on that timeline.

Anthem agreed in July to buy Cigna in a cash-and-stock deal that valued Cigna at about $48 billion. The transaction, along with the pending acquisition of Humana (NYSE:HUM) by Aetna (NYSE:AET), would reduce the number of big U.S. health insurers to three, from five.

The Anthem-Cigna merger requires approval from the U.S. Justice Department’s antitrust division as well as state insurance regulators. In March, Bill Baer, now the No. 3 official at the Justice Department, called the Cigna deal and Aetna’s deal for Humana “transformational” and said they require close scrutiny from the government.

Matt Asensio, a Cigna spokesman, declined to specify why the insurer cautioned that the deal may not happen this year.

“This disclosure reflects our current understanding, based on the breadth and depth of the review and where we believe we are in the process now,” Asensio said. “We feel that it’s a dynamic environment, and there’s a lot of complexity in the regulatory process, so it’s possible that the approvals may not be obtained in 2016.”

Cigna said in the filing that Anthem may owe it a breakup fee of $1.85 billion if the transaction isn’t completed by Jan. 31, 2017. That deadline can be pushed back to April 30, Cigna said.

Cigna fell 1.9 percent to $132.40 at 10:30 a.m. in New York, while Anthem declined less than 1 percent to $136.77.

Peter Costa, an analyst at Wells Fargo & Co., said Cigna’s disclosure indicates the deal could be delayed or not approved at all. “The 10Q deal timing disclosure is a significant item that likely widens the spread,” he wrote in a research note to clients.

See also:

Aetna’s Humana deal pressures Cigna to agree on Anthem offer

AIG Confirms It Will Get Breakup Fee

June 2018
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Reeve Conover is a Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/dealer member FINRA/SPIC. Cambridge and Conover Consulting are not affiliated. Licensed in SC, NC, NY, CT, NJ, and CA.
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