Why is the Signify Health Acquisition Such A Big Deal?

CVS beats out Amazon for Signify Health(axios.com), Sarah Pringle

Why does was CVS battling Amazon for a rinky-dink company like this matter? Hmmm, think back to “Value-Based Payment. It is the New For-Profit Health Care Industry” and all of the healthcare providers being acquired by insurers.

There is also an involuntary push going on by CMS moving people out of traditional Medicare to these plans. Traditional Medicare has price control and is more efficient than Medicare Advantage or Value Based Payment plans. Both of which are commercial and a part of healthcare insurance plans. But VBP and Medicare Advantage needs clinics.

By repurposing a trump program, the Biden CMS administration is moving people to these plans. :

The Biden administration is redesigning a Trump-era Medicare pilot program opposed by dozens of congressional Democrats who viewed it as an effort to privatize Medicare for the elderly and disabled.

The Centers for Medicare & Medicaid Services on Thursday announced the Global and Professional Direct Contracting Model will be replaced by the ACO Reach Program (ACO) realizing equity, access, and community health model. This is a rebadging of the trump program.

The transition to the ACO REACH model will begin Jan. 1, 2023. Current GPDC Model participants must agree to meet all the ACO REACH Model requirements by that date to continue participating.

Trump-Era Medicare Pilot Program to Get Reboot From Biden HHS (2),” (bloomberglaw.com)

Repurposing the trump program shifting costs via Medicare Advantage and Value Based Plans (VBP) to care givers in companies like Signify. The same as Medicare Advantage plans VBP can not compete with traditional Medicare. These plans are not competitive with traditional Medicare. The Medicare Advantage and VBP insurance companies shift costs to the care givers to control those costs. Think coding, denial of care, etc.

As a result, companies are bidding on various healthcare givers as I mentioned in the introduction of “Value-Based Payment Is the New For-Profit Health Care Industry”- Angry Bear (angrybearblog.com).

“Signify health completes more than one million in-home wellness assessments (IHWAs) yearly for Humana’s Medicare Advantage membership with a clinical network of more than 9,000 providers nationwide.”

Signify Health API Case Study – Humana Data Exchange

This adds capacity for providing of healthcare for Medicare Advantage/VBP companies.

Accomplishing patient assessments establishes codes for each patient which creates payment criteria for the upcoming year. This is exacting what Medicare Advantage does. The government prepays based upon those codes. Patients may not be treated for those coded issues in the year they were covering.

CVS has been outspoken about its intent to move closer to the patient, away from its historical roots. Signify moves CVS away from just the pharmacy — and into the home. Through the deal, CVS gains access to 10,000-plus new clinicians nationwide providing health and wellness visits to nearly 2.5 million patients in the home.

This is CVS’s largest M&A move into providing health care to people through heathcare givers. In the industry, was larger, buying Aetna in a $69 billion in 2018 and acquiring Caremark RX for around $27 billion in 2007.

If you have been paying attention, you will notice our most recent post was Kip Sullivan’s piece, “Value-Based Payment Is the New For-Profit Health Care Industry” – (angrybearblog.com). This piece discusses Value Based Payment plans. CMS is forcing traditional Medicare participants into VBP plans. This will make Medicare Advantage and VBP companies more profitable. Signify was one such company.

Value-Based Payment Is the New For-Profit Health Care Industry” – (angrybearblog.com)

Global & Professional Direct Contracting Model” | Medicare

ACO REACH” | CMS Innovation Center

Trump-Era Medicare Pilot Program to Get Reboot From Biden HHS (2)” (bloomberglaw.com)