In the first half of 2023, Aetna, a subsidiary of CVS Health, underwent significant changes. These included leadership appointments, contract acquisitions in North Carolina and New York City, legal disputes, and involvement in Medicaid redeterminations. Additionally, Aetna faced lawsuits and scrutiny over Medicare Advantage plans, while CVS Health made notable acquisitions and reported financial highlights. North Carolina’s decision to switch from Blue Cross Blue Shield to Aetna for employee health benefits was also a key development.
During the initial six months of 2023, Aetna, a subsidiary of CVS Health, witnessed significant developments. These include the appointment of a new leader for Aetna, important contract acquisitions in North Carolina and New York City, and notable legal disputes.
1. Leadership Change at CVS Health: CVS Health, the parent company, announced the appointment of a new leader for Aetna during the first half of 2023.
2. Contract Acquisitions: Aetna secured crucial contracts in North Carolina and New York City, expanding its presence and healthcare offerings in these regions.
3. Acquisitions by CVS Health: CVS Health completed the acquisitions of Oak Street Health and Signify Health, strengthening its healthcare portfolio.
4. Legal Battle with Cigna: CVS Health became embroiled in a legal dispute with Cigna over an executive hire, which resulted in a legal injunction against the hiring.
5. Medicaid Redeterminations: Aetna and CVS Health actively participated in Medicaid redeterminations across all 50 states. Utilizing its extensive retail network, Aetna informed Medicaid members about the need to renew their coverage, regardless of their managed care plan.
6. Lawsuit Against Aetna and OptumHealth Care Solutions: A federal judge in North Carolina certified a class-action lawsuit alleging Aetna and OptumHealth Care Solutions conspired to use deceptive billing practices.
7. Lawsuit Challenging Aetna Medicare Advantage Plan: Retired New York City employees filed a lawsuit against Mayor Eric Adams and other city officials to prevent the implementation of an Aetna Medicare Advantage plan for the city’s retired workers and dependents.
8. Scrutiny Over Medicare Advantage Claims Denials: Lawmakers sought more information about claims denials from major Medicare Advantage insurers, including CVS Health. The Senate Permanent Subcommittee on Investigations requested internal documents to understand how insurers determine claim approvals and denials, including the use of artificial intelligence.
9. Leadership Transition: Brian Kane was announced as the incoming president of Aetna, set to assume the position on September 1, succeeding current president Daniel Finke.
10. Financial Highlights: CVS Health CEO Karen Lynch received total compensation of $21.3 million in 2022, with a CEO-to-median-employee pay ratio of 380-to-1. CVS Health reported a profit of $4.2 billion in 2022 and announced the acquisition of primary care company Oak Street Health for $10.6 billion in an all-cash deal. Additionally, Aetna’s projected operating income for 2024 is expected to decline by up to $1 billion due to decreased enrollment in its Medicare Advantage plans.
Furthermore, North Carolina terminated its longstanding relationship with Blue Cross Blue Shield and selected Aetna as the administrator for employee health benefits, citing cost savings and enhanced price transparency. Blue Cross NC is challenging this decision in court.
These key updates highlight the noteworthy developments and milestones for Aetna and CVS Health during the first half of 2023.