SAN FRANCISCO—The top brass at CVS Health reiterated Tuesday that the healthcare giant is still plotting its move into primary care but emphasized that they want to ensure the next steps are the right ones.
CVS presented early on the second day of the J.P. Morgan Healthcare Conference as media reports circled that its primary care target could be Oak Street Health. Bloomberg reported that a $10 billion deal could be reached in weeks, citing people familiar with the negotiations.
However, Bloomberg's sources did note that the ongoing talks between the companies could end without a deal in place.
For her part, CVS CEO Karen Lynch did not address the reported conversations with Oak Street Health. She said that while the company is still planning its push into primary care, it doesn't want to act hastily.
"What we’ve been very clear about is we want to make sure it’s the right asset at the right time," she said. "This isn’t a one-and-done."
Lynch said during the company's second-quarter earnings call in August that CVS was planning to get some kind of primary care deal on the books by the end of 2022. It reportedly courted and was rejected by concierge care provider One Medical, which is in the process of being bought out by Amazon.
Instead, it announced plans to acquire Signify Health, a move that instead enhances CVS' capabilities in home health and value-based care.
The $8 billion deal is currently under regulatory review, and Lynch said the company expects it to close in the first half of 2023.
Signify's strengths also align with key priorities at CVS, she said, as home health is the "future of healthcare," and the company is aiming to make a greater push into enabling value-based care. A tightrope the company had to walk, though, is working with its competitors such as Humana that are also existing Signify clients.
Lynch said that as major insurers become increasingly diverse and vertically integrated, they've had to navigate the combination of direct competitors who are also clientele.
"As we think about the industry, we’re all kind of working with each other, and we’re all kind of customers of each other," she said. "We’ve committed to them to be payer agnostic, and we think that’s how the industry will evolve over time."
The Signify deal also brings with it Caravan Health, which is built to assist in establishing accountable care programs and was scooped up by Signify in early 2022. Lynch said Caravan's capabilities will be critical to CVS' ambitions in the provider space moving forward.
Chief Financial Officer Shawn Guertin added that the company's plans around primary care also feed back into its focus on value-based care, as effective, accessible primary care is central to the care continuum.
"This is the first leg of the stool in our longer strategy," Lynch said.