Locals welcome CVS purchase of Aetna

Locals welcome CVS purchase of Aetna

Deal could mean growth in area jobs

WOONSOCKET – The city’s largest employer may soon also be one of the largest companies in the country, following news this week that CVS Health aims to purchase insurance giant Aetna for $69 billion.

And while it is unclear if the deal, which must still gain approval from regulators and shareholders, will bring more jobs to the city, CVS officials said they expect to see some changes locally. The company currently employs some 5,300 workers between its city-based pharmacies and its headquarters at One CVS Drive.

“Over the years, we’ve seen career development and job opportunities open up for colleagues following our previous acquisitions of companies including Caremark, Coram and Omnicare, and we would expect similar opportunities to occur following the acquisition of Aetna,” said Mike DeAngelis, senior director of corporate communications for CVS Health.

Mayor Lisa Baldelli-Hunt says she spoke with a representative from CVS Health on Monday to congratulate the company on the potential acquisition and reiterated the importance of the company to the city.

“CVS Health is a very important part of the structure of our community,” the mayor said, adding the deal “certainly has a huge impact not only on the city, but on the families who are employed by CVS Health.”

“We’re appreciative of the fact that they call Woonsocket home,” Baldelli-Hunt said. “If there’s a possibility CVS Health has the opportunity to expand locally, I would be hopeful we could have a conversation surrounding that topic.”

The potential merger of the city-based drugstore giant, currently the largest in the country in terms of pharmacy locations, with the nation’s third largest health insurer, was big news nationally this week, as publications including Forbes, The New York Times and The Washington Post questioned what the deal could mean for the country’s changing health care industry. Leaders from both companies have stated that the transaction would establish a new way of delivering care that would ultimately save patients money.

“We think it’s a great deal and we applaud the leadership of both organizations,” John Gregory, president/CEO of the Northern Rhode Island Chamber of Commerce, said in reaction to the news. “From everything they’ve said, this is all about, how do we deliver better quality health care at affordable prices. Certainly, that’s a good thing not just for Rhode Island residents, but all the folks that use CVS and Aetna.”

Many have cited the deal’s potential to reshape the industry. Proponents say the merger would allow improved coordination of care and increased access to services.

That means the roughly 10,000 CVS pharmacies across the country would be transformed into care sites where nurses and pharmacists are able to do lab work and diagnose and counsel patients in a way that could be far less costly for patients, CVS CEO Larry Merlo told investors earlier this week. Company officials said they hope the sale will close by the second half of next year.

Baldelli-Hunt pointed out that the proposed merger comes at a time when the industry is changing.

“Combining two great companies like this certainly helps to empower the health care market, and at this point in time, I think that’s a very timely topic,” she said.

If approved, the acquisition would put the two businesses’ annual combined revenue on par with companies such as Walmart, according to a report by WPRI. When current figures are combined, CVS and Aetna would reportedly have revenue of about $221.4 billion annually.

Aetna currently has more than 22 million members signed up for its insurance plans, and members of the current management team are expected to continue to run the business.

That company announced it would move its headquarters from Hartford, Conn., to New York City in June, taking with it 250 current and new executive and digital jobs. Aetna has been based in Hartford since its founding in 1853.

DeAngelis said CVS, meanwhile, is committed to staying in Woonsocket.

Gregory said that while the merger’s potential impact on the area is unclear, the willingness to be a leader in the industry makes Rhode Island look good.

Founded by brothers Stanley and Sidney Goldstein and partner Ralph Hoagland with a first store in Lowell, Mass., in 1963, CVS broke ground on its city headquarters in 1981, and has remained here since.

“It certainly shows CVS’s continued commitment to improving who they are,” Gregory said. “I don’t think we’ll see an influx of Aetna executives coming into Woonsocket, but certainly it doesn’t hurt our brand as a community with a company in our back yard continuing to innovate.”

The purchase, which would be paid for in both cash and CVS stock, will now be subject to regulatory proceedings, and investors across the globe are now watching to see if the Trump administration will look on it favorably.

At least in Woonsocket, it seems, the verdict is in.

“It puts CVS Health in a position to help to empower its customers, and I look forward to seeing how it all unfolds,” said Baldelli-Hunt.