Healthcare's mega-merger-mania is catching. Docs are immune

September 20, 2018 Matthew Arnold and Andria Schmid

Back in March, the healthcare industry was jolted by the announcement of a planned merger of Express Scripts and Cigna. The deal was seen, in part, as an effort by a huge insurer and a huge PBM to insulate themselves from the expected entry of Amazon into the sector. It was also an important test case for a data- and technology-driven transformation of patient care, promising to “make health care simpler for consumers by harnessing actionable insights and predictive analytics, maximizing adoption of evidence-based care and delivering industry-leading innovation and medical technology to support care decisions.”

On Monday, antitrust officials approved the merger. Investors were excited, giving a nice pop to the stock prices of both companies. Physicians, however, are unimpressed.

Seventy-one percent of U.S. physicians surveyed for DRG Digital | Manhattan Research’s Taking the Pulse U.S. 2018 study agreed that they were “concerned that these vertically-integrated companies will fail to pass on cost savings to patients.” In fact, 43% of physicians thought such mega-mergers creating “vertically-integrated” healthcare behemoths would actually hurt their ability to provide high-quality care to their patients.

Older physicians are actually a little more pessimistic that this new type of healthcare company would pass on savings to patients – 73% of those over 45 said they wouldn’t, while 67% of those 44 and younger agreed. Gen X and older physicians, of course, may remember the hype which attended the rise of HMOs in the ‘90s and PBMs in the ‘00s.

Younger physicians were also much more hopeful about these chimeric companies’ potential to improve care using patient data and emerging technologies. Among physicians age 44 and younger, 41% think an emphasis on digital health will help these vertical entities to improve patient outcomes. Thirty-three percent of physicians 45 and older agree.    

And younger physicians are, unsurprisingly, a little more excited about the prospect of getting to work with the patient outcomes data these goliaths collect -- 39% of those 44 and younger were stoked about the data implications, to 30% of their older counterparts.

Sifting the data by specialty, among the specialists most concerned that mega-mergers would hurt patient care were cardiologists (54%), neurologists (53%), rheumatologists (53%) and oncologists (51%).     

Cigna-Express Scripts will have some sweet talking to do with these specialists – as will CVS-Aetna and UnitedHealth-DaVita if, as expected, they win government blessing to merge.

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