SCPC: CVS Health-Aetna Merger Emblematic of Growing Arms Race to Consolidate, Control Seniors’ Access to Prescription Drugs

Washington, DC, October 10, 2018 --( Commenting on the U.S. Department of Justice’s (DoJ) conditional approval today of CVS Health's $69 billion acquisition of Aetna, which clears the way for a monumental entity combining health insurance, provider and pharmacy services if Aetna sheds its primary Medicare drug business, the Senior Care Pharmacy Coalition (SCPC) said seniors will be more vulnerable to prescription drug access problems than they were prior to the expected merger.

“The proposed CVS Health-Aetna merger is emblematic of the growing arms race to consolidate and control consumer access to appropriate prescription drugs, particularly LTC patients,” warned Alan G. Rosenbloom, President and CEO of SCPC, the only federal advocacy organization devoted exclusively to the interests of the nation’s LTC pharmacies and the patients they serve.

“We are already alarmed by the fact that three market-dominant players – CVS Health, ExpressScripts and United Healthcare – own the three market-dominant PBMs and market-dominant chain pharmacies in the retail, mail order, specialty and LTC markets. By allowing CVS Health to expand its presence in the insurance markets, the government essentially is allowing these health care monoliths to exercise increasing control over the health insurance market as well,” Rosenbloom continued.

“This merger and acquisition activity, rapid vertical and horizontal integration and stubborn adherence to non-transparent business practices threatens the nation’s commitment to free and fair markets - and ultimately place both consumers – particularly Medicare Part D beneficiaries – and LTC pharmacies at a competitive disadvantage,” he said. Independent research confirms that such consolidations undermine competition and deliver sub-optimal outcomes for consumers – higher prices, restricted access to medications or both.

LTC pharmacies, a distinct subset within the pharmacy community, serve a specialized population of seniors in skilled nursing centers, assisted living facilities and other residential care settings. The typical patient suffers from multiple chronic conditions, significant impairments in daily living activities, mild to moderate dementia, and takes 12-13 prescription medications daily – making drug prices and access to needed medications an essential variable in maintaining vulnerable seniors’ health and well-being.

The SCPC President and CEO said more than 60% of hospital readmissions from nursing centers involve medication issues. Effective oversight and ready access to medications as part of a patient’s clinical care are important factors for reducing hospital readmissions and associated costs. “Restricting access to needed medications and higher than necessary drug costs will undermine care, inhibit quality outcomes for LTC patients and increase the burden on taxpayers,” he said.

Rosenbloom pointed to CVS Health’s control of the LTC marketplace – operating the PBM, Caremark, the LTC pharmacy chain Omnicare, and an expanded presence as a large insurance company – as a sign of worse things to come. Earlier this year, the State of Ohio convincingly concluded that by manipulating its dominant position across related markets, CVS Health exploited Ohio’s Medicaid program and overcharged the state by paying its own affiliated pharmacies more than other pharmacies. The market power of those unaffiliated pharmacies was also artificially suppressed making it difficult to acquire or close when they were forced out of the market by discriminatory pay practices.

The result: Medicaid beneficiaries in Ohio saw access to medications decline while taxpayers paid more and CVS Health reaped windfall profits. Rosenbloom noted that the Ohio Medicaid program recently terminated its contracts with Caremark due precisely to these market manipulations.

“Competition and choice are the two casualties of today’s announcement, and the bottom line is seniors will have less access to needed medications, unaffiliated pharmacies will be less able to offer alternatives and the new generation of healthcare oligopolies will reap windfall rewards at taxpayer expense,” Rosenbloom concluded.

The Senior Care Pharmacy Coalition (SCPC) is the only national organization exclusively representing the interests of LTC pharmacies. Its members operate in all 50 states and serve 750,000 patients daily in skilled nursing and assisted living facilities across the country. Visit to learn more.
Senior Care Pharmacy Coalition
Ellen Almond