AET/CVS: Potential WellCare Divestiture Largely Addresses Concentration Issues in Part D

Event Driven Takeaways

  • The DOJ will look closely to ensure that potential divestiture of Aetna/CVS’ Medicare Part D assets to WellCare would restore competition. Event Driven’s analysis reveals that a potential divestiture of Aetna/CVS’ Part D lives to WellCare will likely address most of the market concentration concerns at the county level.
  • Assuming the DOJ requires divestitures of Medicare Part D lives associated with the smaller of the two merging parties in an overlapping county, the sale of these lives to WellCare will not trigger additional concentration concerns in the vast majority of counties where overlaps exist.

Wellcare is an appropriate divestiture buyer, based on an analysis of Medicare Part D market shares in the counties where overlaps exist. Divestiture of Part D covered lives to WellCare is unlikely to raise concentration concerns in the vast majority of counties analyzed, except for some 82 counties spread across states such as Mississippi, Arkansas and Nebraska. As previously reported, WellCare is the mo