NY Agency Considering Blocking CVS-Aetna Merger
New York State Department of Financial Services superintendent Maria Vullo said she is concerned that CVS Health could raise insurance premiums for millions of New York residents.
October 22, 2018 at 08:57 AM
2 minute read
The original version of this story was published on Corporate Counsel
If the New York State Department of Financial Services has anything to do with it, the planned merger between CVS Health and Aetna Inc. may not be a done deal.
At a public hearing on Thursday, the agency's superintendent, Maria Vullo, said she is concerned that CVS, which had to borrow $40 billion to fund the $69 billion deal, could raise insurance premiums for millions of residents, according to a New York Post account of the hearing.
“I can stop the deal if it is reasonably necessary to protect New Yorkers,” she is reported as saying. “In our view, there must be a clear enforceable commitment not to transfer the cost of paying back loans to policyholders.”
Earlier this month the U.S. Department of Justice announced that it will approve the retail pharmacy giant's purchase of Aetna, one of the country's largest health insurers, assuming the latter divests its Medicare Part D prescription drug plan for businesses for individuals. The deal still has to pass through state regulatory agencies, though.
In addition to her concern about potential premium rate increases, Vullo also was seeking support from CVS for a proposed state law that would require prescription benefit managers to register with the Financial Services Department, the Post said.
CVS lawyer Elizabeth Ferguson told Vullo during the hearing that the company would not oppose the measure, according to the Post.
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