UnitedHealth Deal Expands PBM Reach

The nation's largest health insurer and one of the nation's largest pharmacy chains are teaming up in a move that could bring significant cost savings and improved operational efficiency in caring for psychiatric patients and those with substance use disorders.

UnitedHealth Group paid $2.5 billion to buy Genoa Healthcare, outbidding Walgreens Boots Alliance, Bloomberg reports. Genoa, which runs 425 pharmacies in behavioral health centers in 46 states and serves more than 650,000 people, will combine with UnitedHealth's pharmacy benefits business, OptumRx. Genoa focuses on behavioral health, addiction treatment and chronic health conditions, and offers telepsychiatry and medication-management services.

The move is particularly significant for the potential cost-reduction capabilities that Genoa has demonstrated. Healthcare Finance notes that Genoa has a drug adherence rate of more than 90 percent and has helped clients reduce emergency department visits by 40 percent and hospitalizations by 18 percent.

The purchase is also noteworthy given several large mergers being completed that would become viable competitors to UnitedHealth, including the Department of Justice's approval of Cigna's acquisition of Express Scripts. That deal will give Cigna control over one of the nation's largest pharmacy benefit managers.