Two recent articles provide additional evidence that a new type of first-tier, healthcare hub is emerging. It consists of the following: (1) a retail drug store like CVS or Walgreens; (2) a walk-in healthcare clinic like MinuteClinic; (3) direct organizational and financial ties to a major health insurance company like Aetna; and (4) a reference laboratory patient service center (PSC) for blood draws provided by a company like LabCorp. Here's the first of the two articles (see: CVS Health and Aetna $69 Billion Merger Is Approved With Conditions) with an excerpt is below:
The Justice Department’s approval of the $69 billion merger between CVS Health and Aetna on Wednesday caps a wave of consolidation among giant health care players that could leave American consumers with less control over their medical care and prescription drugs....As the last major free-standing pharmacy manager, CVS Health had revenues of about $185 billion last year, and provided prescription plans to roughly 94 million customers. Aetna, one of the nation’s largest insurers with about $60 billion in revenue last year, covers 22 million people in its health plans....“The combination of CVS and Aetna creates an enormous market force that we haven’t seen before,” [a commentator] said.....[S]tate regulators and consumer groups have also raised other concerns about the impact of the merger, saying that the lack of large pharmacy managers that aren’t affiliated with insurers could make it difficult for smaller competitors in either sector.....Much of the enthusiasm over CVS’s acquisition of Aetna has focused on the insurer’s addition of a retail component and the potential use of CVS’s 10,000 pharmacies and 1,100 retail clinics to deliver care, particularly to Aetna customers. Imagine a single hub where someone can go to get care for everything from a sore throat to their diabetes. CVS stores could become places to get blood tests for monitoring chronic conditions, not just toothpaste or prescription refills.
Here's the second of the two articles, this one addressing as new relationship between Walgreens and LabCorp, a large national reference lab (see: Walgreens, LabCorp To Open 600 Diagnostic Test Centers). Below is an excerpt from it:
Walgreens Boots Alliance Wednesday said it will expand a collaboration with diagnostic testing firm LabCorp. to open at least 600 patient service centers at Walgreens stores over the next four years....“LabCorp’s strong partnership on this joint initiative, coupled with the enthusiastic consumer feedback we’ve received, allows us to undertake an exciting expansion of our collaboration together,” Walgreens executive vice chairman and CEO Stefano Pessina said. ....Walgreens’ effort to provide lab-testing services in its stores is part of an ongoing transformation into becoming more of a healthcare services company than a retailer. Walgreens tried to bring diagnostic tests to its stores in Arizona via its Theranos partnership, but that deal ended following investigations into the accuracy of Theranos blood tests. Walgreens has said the lab testing services with LabCorp will complement its pharmacy and healthcare clinics. The centers will be branded “LabCorp at Walgreens” and offer specimen collection services for LabCorp testing, the companies said.
Below are some of the possible features and services of the first-tier, healthcare hubs that are emerging:
- They may ultimately number in the thousands and will be in close proximity to the majority of healthcare consumers in the U.S.
- The companies owning, managing, and participating in these hubs will each be worth multiple billions of dollars and have access to abundant development capital.
- Hub personnel will have much stronger business incentives to emphasize wellness than many health systems. Such a perspective will be viewed favorably by younger healthcare consumers.
- Because of economies of scale and sophisticated logistics, the national reference labs integrated into these hubs can perform lab testing less expensively than most hospital labs or theoretically deploy POCT testing on site for rapid result TAT.
- By deploying Epic's EHR software, these hubs will have medical record interoperability with any large health systems running Epic EHRs for referrals and record transfers for patients.
- The hubs will be able to provide physician consultations for patients with chronic diseases by outsourcing telemedicine contracts to health systems anywhere in the U.S. Such contracts will be looked upon favorably by those health systems with telemedicine expertise because they do not require expansion of bricks-and-mortar facilities.
- As the number of patents with chronic diseases seen in these hubs increases, hub personnel will exercise greater influence over referrals to in-network physicians, hospitals, and stand-alone imaging centers.