Connecticut Regulators Hear Testimony On Aetna-CVS Deal
Connecticut regulators are considering whether to sign off on the merger between Hartford health insurer Aetna and pharmacy chain CVS. They held a public hearing in the city Thursday.
In a commitment letter revealed just before the hearing, Rhode Island-based CVS said it plans to keep Aetna’s headquarters in Hartford for at least ten years, and will preserve the current level of employment for four.
The city itself and the Connecticut Business and Industry Association have both warmly endorsed the deal, particularly after CVS's remarks. Prior to the merger announcement, Aetna as a standalone company had planned to move its headquarters to New York City.
But not everyone thinks it’ll be great for consumers.
Nathan Tinker is the CEO of the Connecticut Pharmacists Association, which represents independent pharmacies and pharmacy workers. He believes Aetna will direct its own customers solely to CVS for pharmacy needs, cutting down on competition and driving up prices.
“Bringing the insurance company and its pharmacy benefit manager together in-house is tantamount to letting the fox into the henhouse," he told the hearing. "There will be little incentive to control costs or to pass any perceived savings on to patients.”
Charles Bell of the Consumers Union says in many large cities in Connecticut, CVS will end up providing more than half of the pharmacy benefit management - or PBM - services for people with health insurance.
“These new insurer-PBM combinations threaten to be major healthcare oligopolies," he said. "And the game of healthcare consolidation and healthcare pacman, won’t stop here.”
Several speakers urged Connecticut’s Insurance Department either to oppose the merger outright, or to impose conditions that would safeguard consumers’ rights.
Regulators will give their recommendation in coming days. The Department of Justice has yet to rule on the merger.