- The CVS Health takeover of Aetna has technophiles and analytics pundits abuzz for a number of reasons, many of which have to do with the fundamental reshaping of the consumer landscape in Jeff Bezos’ image.
The looming specter of Amazon and its ability to get its tentacles wrapped around new market sectors with uncanny ease has raised speculation that CVS is making a calculated strike at consumer-driven healthcare before Amazon can find purchase in one of the most lucrative industries still waiting for its makeover moment.
But the most significant short-term implications of the marriage between retail health, pharmacy care, and payer services will likely have less to do with the jockeying of stock market giants and more to do with the increasingly important role of big data in lowering costs and improving outcomes.
At the moment, pharmacy data tends to be a half-step out of sync with the rest of the clinical world.
While the use of electronic prescribing among physicians has risen steadily since the beginning of the decade, and the vast majority of pharmacies can accept electronic prescribing data, that information doesn’t always make it back to population health management programs that need to understand medication adherence rates and patient challenges.
Unfilled prescriptions are not routinely reported to primary care providers, who assume the patient is remaining adherent unless specifically told otherwise, and patients are rarely reminded that they have let a prescription lapse.
Medication non-adherence was a $337 billion problem in 2013, contributing to avoidable readmissions, higher emergency department use, and worse outcomes for chronic disease patients.
In one 2016 study, medication non-adherence affected 70 percent of patients prescribed statins for high cholesterol. Patients cited a lack of engagement, communication, and chronic disease management support as some of the reasons why they did not stick to their recommended regimens.
On the provider side, healthcare organizations continually blame fragmented data access and a widespread lack of analytics power to identify high-risk patients as reasons why their population health management efforts are less-than-optimally effective.
A new survey by SCIO Health Analytics found that 58 percent of providers believe inadequate big data access is preventing them from ascertaining the total cost of care for their patients, while 20 percent added that missing data types, such as socioeconomic and behavioral health data, makes it impossible to gain visibility into the complete patient story.
More than a third of providers said lackluster big data means they are unable to close care gaps that have a significant impact on clinical and financial outcomes for patients.
Both Aetna and CVS Health have championed the importance of risk stratification, data-driven targeting for population health interventions, and the need for real-time big data shared across the care continuum.
CVS has invested heavily in electronic health record technology from Epic, which gives it the same data analytics firepower as many of the top hospitals and health systems in the nation. The recent addition of Epic’s Healthy Planet population health management platform was intended to create more visibility into prescribing patterns and adherence rates.
And just days before announcing the Aetna acquisition, CVS Caremark, the pharmacy benefit manager (PBM) arm of CVS Health, launched a new service that enables real-time access to beneficiaries’ individual drug costs, deductible amounts, and prior authorization requirements.
"Patients often do not find out that the medication they were prescribed is not covered or has higher than expected out-of-pocket costs until they go to the pharmacy to pick up their prescription, which can result in patients not filling a prescription, non-adherence and, ultimately, higher downstream health care costs," said Troyen A. Brennan, MD, Executive Vice President and Chief Medical Officer of CVS Health.
"Making detailed, real-time benefit information available for our PBM members and their health care team, whether it's the doctor or the pharmacist, can help streamline the patient experience and improve health outcomes while also lowering costs for both the patient and the payer,"
For its part, Aetna has been active in the accountable care organization (ACO) space, which requires open communication with providers around population health, quality, and spending – although a series of financial setbacks has drawn the public eye more towards its troubles than its successes.
A failed attempt at a merger with Humana, the payer’s complete withdrawal from the Affordable Care Act health insurance exchanges, its decision to leave AHIP, and now the submission to acquisition have painted a difficult picture of the insurer in 2017 and 2018.
But Aetna has a strong big data analytics pedigree and deep experience with population health management – so much so that CVS Health President and Chief Executive Officer Larry J. Merlo prominently highlighted the company’s analytics chops in his public statement about the acquisition.
“With the analytics of Aetna and CVS Health's human touch, we will create a health care platform built around individuals,” he said.
“We look forward to working with the talented people at Aetna to position the combined company as America's front door to quality health care, integrating more closely the work of doctors, pharmacists, other health care professionals and health benefits companies to create a platform that is easier to use and less expensive for consumers."
Readmissions could be halved if patients and providers had complete visibility into their medications after discharge, the press release claims.
“In addition, home devices to monitor activity levels, pulse, and respiratory rates can be used to prevent readmissions. Rather than feeling lost and confused, selected high risk patients discharged from the hospital, or their caregivers, will be able to stop at a health hub location to access services such as medication evaluations, home monitoring and use of durable medical equipment, as needed,” said the release.
“All of these services will complement and be integrated with the care provided by their physician and medical team.”
That brings CVS to the primary reason why adding a payer to its network of pharmacy locations and growing investments in retail clinics could be a genius move for patients, not to mention CVS shareholders.
Part of the reason why Amazon is so successful – and why the CVS-Aetna deal is inviting such strong comparisons – is its ability to collect huge volumes of disparate consumer data and generate highly-targeted suggestions for individuals based on previous purchase patterns and the profiles of similar individuals.
With the addition of claims data, CVS will be adding an important new weapon to its already-impressive consumer health arsenal: not only does it already have access to pharmacy data and some basic health maintenance information from its retail clinics, but it also understands what over-the-counter drugs are purchased at its stores…and how often the individual adds a bag of potato chips, a chocolate bar, or a sugary drink.
Adding claims data to the mix gives CVS visibility into patient health behaviors on a much deeper level, and may enable the company to merge the retail analytics of an Amazon storefront with the clinically-driven population health management analytics of an Epic Systems healthcare provider client.
Integrated clinical and pharmacy benefits have already been proven to lower costs and improve patient engagement around certain chronic diseases, Aetna has said.
The strategy can reduce medical spending by up to $117 per member per month, a recent study showed, while reducing hospital admissions and emergency department use.
For patients, the results of this big data melting pot could be transformative.
While CVS may not go so far as to buy or develop its own comprehensive primary care network or inpatient setting run by physicians, it is likely that it will expand its presence in the retail clinic environment, or perhaps purchase some well-equipped urgent care clinics that have already established themselves in the community.
This could create a brand new healthcare delivery segment: mid-level care sites with a co-located pharmacy that are also directly linked to a patient’s payer.
Turning the traditionally cash-based segment of urgent care into a payer-backed alternative to primary care could generate a significant revenue stream for CVS and solve one of the biggest problems of preventive care for patients: catching and treating low-level complaints that patients don’t feel are worth the rigamarole of a full-fledged primary care appointment.
If the patient’s payer has direct access to that data, that is one less point of interoperability that has to be established between the traditional primary care segment and retail clinics. PCPs will access retail clinic data and pharmacy data the same way they access claims data.
A single, comprehensive data packet will serve to inform primary care providers about medication adherence and prescription spending, retail clinic use for ear infections or flu shots, and claims submitted from hospitals, emergency departments, specialists, and any other care sites.
For a primary care provider quarterbacking a chronic disease patient, this could be a huge benefit – especially because the data will already be in standardized formats generated by Certified EHR Technology (CEHRT) from a vendor that has made interoperability one of its flagship causes.
Bringing the care continuum that much closer together could drastically improve population health and chronic disease management, enable the delivery of proactive alerts based on targeted risk scoring, and lead to lower costs on medications, utilization spending, and even plan premiums.
The challenge for other health plans – and for Walgreens, which is CVS’s main competitor in the retail clinic space – will be to establish similarly innovative partnerships with key players across the care continuum.
Some of the big players have already started to make their moves. Walgreens, which together with CVS owns about three-quarters of the existing retail clinics, has also invested in Epic Systems technology. Anthem, after weathering a damaging data breach and a similarly failed mega-merger, has poached part of its big data analytics team from the retail sector in a bid to make its care even more consumer-centered.
The mashup of cost and utilization data, customer experience metrics, care management, and strategic positioning will continue to be a “competitive differentiator” for payers as they jostle for position in a sector that has suddenly taken a sharp turn away from the norm.
Whether CVS will successfully lead the pack in a new direction – and what direction that might end up being – remains to be seen, but the purchase of Aetna could turn out to be a very shrewd move that aligns retail-style customer service with better population health, resulting in lower costs and a more seamless experience for beneficiaries.