Aetna profits jump, CVS tests new membership pilot
As CVS Health and Aetna are awaiting final regulatory approval for their $69 billion merger, Aetna, the nation’s third-largest health insurance provider, reported strong earnings during the third quarter of the year, with $1 billion income.
The CVS-Aetna deal faces only one more hurdle––New York regulators.
Aetna’s third-quarter net income reached $1 billion, beating analysts’ expectations. The income was a 19 percent jump from the same quarter a year prior. Aetna’s net income for the first nine months of the year hit $3.4 billion.
“Our financial performance demonstrates a continued focus on delivering solid operating results as we prepare to close our pending transaction with CVS Health,” Shawn M. Guertin, Aetna executive vice president and CFO, said in a statement. “With our extensive integration planning process now set to shift to an implementation phase, I am confident the combined company is well positioned to begin the next stage of our journey."
Aetna’s share price had a modest bump of about 1.5 percent upon release of the company’s earnings, hovering just below $199 per share as of mid-day trading Wednesday.
CVS membership
CVS also announced it will be piloting a membership program at pharmacies in Boston. The program includes free delivery on prescriptions and online sales, a 20 percent discount on all CVS-branded products and a $10 monthly coupon.
Consumers can sign up for the membership, called CarePass, for $5 per month or $48 annually. The membership may be an attempt to stave off competition from Amazon, which offers its prime delivery membership for $119 per year. Amazon recently acquired an online pharmacy PillPack for $1 billion and has launched an exclusive line of medical products.
"We are committed to designing and testing innovative programs that meet our customers' health needs whenever, wherever and however they want," Kevin Hourican, executive vice president of CVS Health and president of CVS Pharmacy, said in a statement. "The CarePass pilot program in Boston offers our customers an additional level of benefits and services that make it easy to save time, save money and receive access to on-demand pharmacy care."
The pilot has launched in 350 stores throughout Boston.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."