More on Mergers & Acquisitions

AMA files motion to testify in CVS and Aetna merger

The DOJ and CVS Health are seeking to block certain testimony they say is outside the scope of review.

Susan Morse, Managing Editor

The American Medical Association wants the chance to testify on the merger of CVS Health and Aetna.

The case continues in federal court, though the Department of Justice gave merger approval in November 2018 and CVS has said the two companies are one.

On Friday, the AMA filed a response to an April 26 motion by CVS and Aetna asking the judge to exclude testimony from the AMA and other groups that it considers outside the scope of review.

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The AMA asks U.S. District Judge Richard Leon to conclude that testimony by three healthcare and antitrust experts is relevant. Also, the CVS and Aetna motion should be denied because CVS and the DOJ failed to contact opposing counsel, the AMA said.


The AMA has objected to the merger, saying patients would be harmed by a highly concentrated market.

But CVS has left out information, creating a gap in the court record, and has mischaracterized the AMA's view on competition, according to court documents.

Some believe that the vertical merger gives CVS/Aetna the ability to raise its rivals' costs, weakening their ability to compete in the prescription drug plan market, the AMA said in court documents.

Others believe that retail clinics may increase primary care revenue by generating referrals to practices and by allowing physicians in practice settings to focus on sicker patients with more complex needs, which generally provides higher payment.

This premise is supported by evidence that, while physician office visits for acute minor conditions have declined by 13 percent since the advent of retail clinics, total physician visits have remained steady.

Retail clinics may have a role to play in providing timely and affordable access to primary care services, the AMA said. It is estimated that if the 20 percent of emergency department visits that are for low-level conditions could instead be treated in a retail clinic, the healthcare system would save an estimated $4 billion annually.


The DOJ settlement to antitrust concerns was to have Aetna divest of its Medicare Part D plans, which it has done.

Judge Leon exercised his authority to review the deal on antitrust concerns, which is ongoing.


"Testimony from AMA witnesses in the evidentiary hearing will ensure a full airing of the arguments for and against CVS's merger with Aetna," the AMA said. "CVS and the DOJ believe that the court should decide whether the merger is in the public interest based on the written record alone, but that record contains major gaps in the evidence on issues for which the DOJ bears the burden to 'provide a factual basis for concluding that the settlements are reasonably adequate remedies for the alleged harms.'"

Twitter: @SusanJMorse
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