CVS Health Finalizes $8B Acquisition of Signify Health
The merged CVS Health and Signify Health organization will focus on improving care delivery, lowering costs, and boosting member engagement.
Source: CVS Health
- CVS has finalized its acquisition of the home healthcare company Signify Health, which aims to accelerate value-based care and improve health outcomes.
“This transaction advances our value-based care strategy by enhancing our presence in the home,” Karen S. Lynch, president and chief executive officer of CVS Health, said. “Our expanded capabilities will bring us closer to the consumer as we continue to redefine how people access and experience care that is more affordable, convenient, and connected.”
The payer first announced its plans to acquire Signify Health back in September 2022. According to Bloomberg, the payer was competing against UnitedHealth Group, Amazon, and Option Care Health to buy the company.
Signify Health’s network includes more than 10,000 clinicians across all states. These clinicians spend an average of 2.5 times longer with members during home visits than an average visit with a primary care provider, the press release stated.
The outstanding shares of Signify Health common stock are being exchanged for $30.50 cash, translating to a value of around $8 billion, per the transaction terms. CVS Health funded the transaction price with existing cash and available resources.
The merged organization will focus on improving care delivery, lowering costs, boosting member engagement, and facilitating access to quality care for Medicare Advantage beneficiaries in particular.
“Our mission has always been to build trusted relationships to make people healthier,” Kyle Armbrester, chief executive officer of Signify Health, said. “As part of CVS Health, we will be uniquely positioned as a payor-agnostic business to support a more proactive, preventive, and holistic approach to patient care.”
Armbrester will continue to lead the company, the announcement noted.
Signify Health also includes Caravan Health, which provides technology services to providers and practices in accountable care organizations. Signify Health acquired the company in March 2022.
The transaction between CVS Health and Signify Health further solidifies the payer’s move into the value-based care space. The healthcare giant recently announced plans to acquire the value-based primary care organization Oak Street Health in a transaction valued at $10.6 billion.
CVS projects more than $500 million in synergy potential between the organizations, enhancing long-term operating growth.
