Representatives for CVS and Aetna will go before Congress today in an effort to assure lawmakers that the $69 billion deal is in the public's interest.
CVS announced its plans to acquire Aetna in December, and the Department of Justice has requested additional information on the merger. The two parties hope to have the deal finalized by the end of this year.
It's unclear if the deal will survive an antitrust probe, or whether the merger would pay off for patients. A group of health policy researchers recently testified before legislators that consolidation in healthcare, both among insurers and providers, doesn't really benefit patients.
Attorneys for both CVS and Aetna will argue the opposite at the hearing, which will be held in the House Judiciary Committee Subcommittee on Regulatory Reform, Commercial and Antitrust Law. In his prewritten testimony (PDF), Thomas Moriarty, CVS' executive vice president, chief policy and external affairs officer and general counsel, said that the merger is "a natural extension of our commitment to better health and healthcare."
"At its core, the acquisition is about putting the consumer at the center of the healthcare delivery system to ensure they can access high-quality and more affordable care where they are, when they need it," Moriarty said.
The merger, Moriarty said, will allow for more integrated care, as it empowers pharmacists to play a greater role between patient visits to the doctor. If the deal goes through, it will also enhance competition, particularly in the pharmacy benefits management space, and will allow CVS to lower patients' healthcare costs, according to the written testimony.
Chairman @RepGoodlatte: "As we review the proposed merger between CVS Health and Aetna Inc., we should examine the potential positive and negative impacts that this merger could have on American consumers and the economy."— House Judiciary ⚖ (@HouseJudiciary) February 26, 2018
Subcommittee Chairman @RepTomMarino: “Every American is affected by the cost of healthcare. I look forward to hearing from our panel of expert witnesses, along with witnesses from CVS and Aetna, on how this merger may affect consumers.”— House Judiciary ⚖ (@HouseJudiciary) February 26, 2018
Thomas Sabatino, Jr., executive vice president and general counsel for Aetna, echoed the sentiment in his prepared testimony (PDF). Both CVS and Aetna "recognize that our combined company must also address the problem of unsustainable costs throughout the healthcare system," Sabatino said.
"Aetna recognizes that the status quo is not sustainable," he said. "We think that the best way to address this crisis is to re-examine our definition of health and organize ourselves around the consumer."
Aetna's CEO Mark Bertolini said in an interview with CBS News that the merger also aims to get more involved in the community to improve people's health. He said the healthcare system currently functions "backwards," as it reacts to illnesses instead of preventing them.
By joining forces with CVS, Aetna can take advantage of its roughly 10,000 clinics to better reach people, the argument goes.
A second panel at the hearing will include four economic and health policy experts who will weigh in on the potential impacts of the merger deal.
Craig Garthwaite, associate professor of strategy at the Kellogg School of Management at Northwestern University, said in his prepared statement (PDF) that if the merger does create value, there are few incentives to pass on any savings to consumers.
"Lawmakers should be legitimately concerned about both equity and efficiency and therefore must consider value capture in addition to value creation," Garthwaite said.
"At a minimum, the efficiency of this merger hinges on the degree of competition in the health insurer market."