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00:00:01
>> Drug store chain CVS and health insurance provider Aetna, finally agreeing to a multi-billion dollar merger that would combine the power of Aetna's 23 million members with CVS's 9,700 retail outlets. Expanding the number and functionality of CVS's so-called minute clinic's into branded urgent care centers is key, says Reuter's health correspondent Carl O'Donnell.
00:00:26
>> CVS has this thing called MinuteClinics and right now it's a place where you can go to get a flu shot, you can go to get a check-up. But there's really a lot of potential to build that out and expand it to more stores throughout the country. So the hope is that by investing heavily and really ramping up the MinuteClinics, deepening their offerings, they can take, there are 23 million people who are Aetna members.
00:00:47
And push them into using those clinics rather than using emergency rooms, hospitals, much more expensive facilities for receiving healthcare.>> Sources familiar with the deal tell Reuters, a reduction in how much the combined companies pay to medical service providers could help cut costs by more than a billion dollars a year.
00:01:10
And there's additional benefits on the revenue side as well.>> If you can get those folks going to more MinuteClinic check-ups to pick up their prescriptions through the CVS Pharmacy, you can drive a lot of foot traffic that can help support the retail business.>> For this plan to work, CVS and Aetna are going to have to spend billions across several years, on more medical equipment and staffing.
00:01:34
But analysts think the duo is on to something. And expect to hear more tie-ups between insurers that only see payments to medical providers going straight up, and to drug stores that only see the retail side of their business remaining under pressure.