Thursday, December 13, 2018

 

DMHC Approves Cigna’s Acquisition of Express Scripts

California Department of Managed Health Care (DMHC) Director Shelley Rouillard approved Cigna Corporation’s (Cigna) acquisition of Express Scripts Holding Company (Express Scripts).

“The Department holds each proposed merger to a high standard of review to ensure consumers’ health care rights are upheld and access to appropriate health care services continues,” said Director Rouillard. “The conditions imposed on Cigna and Express Scripts will improve plan performance, increase access to health care services and assist in controlling health care costs.”

Per the DMHC’s approval, Cigna and Express Scripts agree to not increase premiums as a result of acquisition costs, and keep premium rate increases to a minimum. Both entities have agreed to invest $60 million in California’s health care delivery system. This includes:

  • $35 million to invest in Cigna’s Collaborative Accountable Care and Delivery System Alliances initiatives, which aim to improve health care quality, patient experience, and affordability.
  • $10 million to increase the number of health care providers in underserved communities by funding scholarships and loan repayment programs under the Health Professions Education Foundation.
  • $7.5 million to support California programs that address social determinants of health.
  • $5 million to support California’s health care infrastructure and employment, including building and improving facilities in the state and expanding employment opportunities.
  • $2.5 million to implement and maintain programs and policies that address the opioid crisis.

Cigna and Express Scripts will also support efforts to provide accurate, complete and accessible provider directories, and standardize and improve the quality of encounter data, which is essential for measuring quality of care and cost.

The DMHC’s full conditions to the transaction are available here.

Cigna filed notice of the proposed acquisition of Express Scrips with the DMHC on April 20, 2018. The Department conducted a comprehensive review of the proposed transaction, and examined both entities’ organizational and corporate structures, administrative capacity changes, health care delivery system changes, product or subscriber changes, the effect of the transaction on the financial viability of DMHC licensed plans, the financing for the transaction, and its impact on consumers.

The DMHC held a public meeting on September 26, 2018 regarding the acquisition. The meeting provided an opportunity for members of the public to comment and allowed representatives from Cigna and Express Scripts to publicly explain the transaction.

About DMHC:

The DMHC protects the health care rights of approximately 26 million Californians and ensures a stable health care delivery system. The Department has helped more than 2 million Californians resolve health plan problems through the Help Center. Information and assistance are available at www.HealthHelp.ca.gov or by calling 1-888-466-2219.

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