Elizabeth Warren pushes FTC to 'carefully scrutinize' CVS-Oak Street deal

A top progressive senator is urging the Federal Trade Commission to take a closer look at CVS Health's acquisition of Oak Street Health.

Sen. Elizabeth Warren, D-Massachusetts, sent a letter to the FTC calling on the agency to "carefully scrutinize" the planned $10.6 billion deal and to challenge any M&A activity in healthcare that could lead to higher prices, less competition and lower care quality.

CVS wants to pick up Oak Street to bolster its reach in the primary care space. Oak Street, a Medicare-focused provider, operates 169 medical centers across 21 states and employs about 600 physicians. It's backed by its proprietary tech platform, Canopy, which is built to determine the best type and level of care for individual patients.

Warren said in the letter that she is broadly concerned about the integration, both vertical and horizontal, in the industry, and fears the CVS-Oak Street deal could only make that worse.

"In particular, I fear that the acquisition of thousands of independent providers by a few massive health care megaconglomerates could reduce competition on a local or national basis, hurting patients and increasing health care costs," she wrote.

In addition to calling on the FTC to take a close look at this particular deal, Warren urged the agency to "retrospectively review similar consummated deals and challenge in court any mergers that have reduced competition in violation of antitrust laws."

"I also ask that, using your authority under the FTC and Clayton Acts, you retroactively analyze previous acquisitions of primary and home health care companies by large health insurers and retailers such as United, Humana, WBA, Walmart, and Amazon," Warren wrote. "If the FTC determines that any of these deals violated antitrust law, I urge you to unravel them."

Warren's letter comes on the heels of the announcement this week that the Department of Justice has abandoned its plans to appeal a judge's ruling that allowed UnitedHealth Group's acquisition of Change Healthcare to move forward.

CVS Health and Oak Street expect the deal to close later this year.