A planned primary care partnership between CVS’ MinuteClinics and major nonprofit system Mass General Brigham will likely add tens of millions in additional annual commercial healthcare spending per year, according to a “conservative” preliminary estimate shared by a Massachusetts agency late last week.
The organizations shared plans last summer for a proposed affiliation in which 37 MinuteClinic sites in the state that currently provided limited convenience care services would expand to offer primary care services.
The arrangement would have nurse practitioners working at the site become primary care providers affiliated with MGB, join the system’s Accountable Care Organization and become participating providers in its value-based contracts with payers. The MinuteClinic Primary Care locations would also gain access to MGB’s population health management capabilities.
CVS and MGB have said their plan will increase access to primary care services, particularly in parts of the state where such care is in short supply. Specifically, they expect 80 current MinuteClinic nurses to manage primary care panels of 1,500 patients each after a few years.
The Massachusetts Health Policy Commission (HPC), an independent watchdog agency that could throw a wrench into the deal’s close, weighed in on the claims and whether it would meaningfully impact healthcare costs and local markets.
In its preliminary cost and market impact report, the HPC affirmed that the “transition to primary care has the potential to increase access” for adult patients, particularly if CVS prioritizes areas in high need and targets outreach to Medicaid beneficiaries and others facing socioeconomic barriers to care. On the other hand, a shift away from all-ages convenience care could reduce children’s access to those services, the agency noted, and the model’s long-term sustainability and potential to increase care quality is still up in the air.
However, the report raised red flags over substantial and likely increases to health spending—an area in which the HPC has kept a close eye on MGB, the state’s largest healthcare provider, during recent years.
“MinuteClinic’s convenience care prices have historically been less than half of MGB’s prices for the same services with the same provider type, and substantially lower than those of other comparable providers,” the preliminary report reads. “MGB primary care patients have the highest spending among the largest Massachusetts provider organizations.”
As a result, three years after the transaction’s implementation, the HPC predicted that care delivered through the MinuteClinic Primary Care would fuel about $27.7 million in additional spending. That number reflects MGB’s higher primary care pricing and referrals to high-priced specialists and hospitals for patients who switch over, as well as those currently without primary care access whose “changes to care … may reflect appropriate and improved management of health conditions.”
Another $6.6 million in annual commercial spending would stem from the continuation of convenience care services at the sites, which would be repriced at MGB prices that are 129% higher, on average, than MinuteClinic prices, according to the report. Meanwhile, some current convenience care patients who may be diverted to other comparative providers, whose prices are 94% higher than MinuteClinic’s, would add another $5.9 million in spending per year.
These numbers, together, outline an expected $40.2 million in additional commercial spending in the transaction’s third year, according to the preliminary report. The estimates are based on CVS and MGB’s projections of “moderate acceptance,” in which the sites have reached 35% of their primary care capacity.
“Primary care is the foundation of a strong, sustainable health system, yet it faces increasing pressures in Massachusetts,” HPC Executive Director David Seltz said in a statement. “We must balance this need for primary care alongside the existing affordability challenges our residents face.
Not measured in the report are other potential market impacts, such as an increase to MGB’s bargaining leverage with payers due to its increased footprint. The HPC also acknowledged that the increase in primary care capacity could bring long-term savings, but that those would largely depend on the success of the model and the quality of care it would provide.
In statements responding to the preliminary report’s findings, both MGB and CVS flagged the HPC’s limited exploration of long-term savings—from preventive care and coordination of services—and highlighted the Bay State’s pressing need for more primary care services.
“The primary care capacity shortage is being acutely felt across Massachusetts, with primary care physicians statewide managing unprecedented patient volumes and individuals facing long waitlists to access care,” MGB told Fierce Healthcare in a statement. “We are committed to exploring innovative options that ensure patients can receive timely primary care in their communities, while we continue our efforts to recruit traditional PCPs for our brick-and-mortar practices.”
MGB added that it has “questions about the methodology used,” particularly around the commission’s assumptions of increased spending for those newly accessing primary care services in the arrangement’s opening years.
CVS said the report validated the organizations’ promise of expanded primary care access, but “appears to overstate the potential impact on healthcare spending in the Commonwealth.”
“We continue to believe a collaboration between Mass General Brigham and MinuteClinic would meaningfully benefit Massachusetts patients,” CVS told Fierce Healthcare.
The organizations said they intend to make use of a 30-day window to respond to the HPC’s findings and concerns.
The HPC itself does not have the authority to block a deal or impose conditions, but could refer findings and recommendations in its final report to the state’s attorney general or Department of Public Health. MGB and CVS are also unable to close their deal until 30 days after the final report’s release.
The HPC said that, should the transaction go forward, it expects the organizations will be required to provide ongoing reporting to monitor the deal’s impact over time. The commission did not specify what metrics would be required of CVS and MGB, but suggested it was open to ongoing conversation on the issue.
MGB currently provides about 17% of Massachusetts’ primary care physician services across the state, according to the report, and is largely concentrated in the eastern part of the state. CVS operates 37 MinuteClinics in Massachusetts, “with a somewhat more broadly distributed patient population compared to MGB, including more of western Massachusetts.”