$8B CVS, Signify Deal Helps Pave the Way for Senior Care Transformation

CVS Health (NYSE: CVS) is acquiring in-home health care company Signify Health (NYSE: SGFY) in an $8 billion deal that will help lay the groundwork for future senior living transformation.

The deal is expected to close in the first half of next year, with CVS Health acquiring the company for a price valued at about $30.50 per share. That dollar amount would eclipse the $5.4 billion paid by UnitedHealth Group (NYSE: UNH) for home health and hospice firm LHC Group (Nasdaq: LHCG) in March, and is roughly double the amount that retail and tech giant Amazon (NYSE: AMZN) paid for tech-enabled primary care provider One Medical in July.

CVS is acquiring Signify and in the process gaining a platform for growth in value-based care, according to President and CEO Karen S. Lynch.


“This acquisition will enhance our connection to consumers in the home and enables providers to better address patient needs as we execute our vision to redefine the health care experience,” Lynch said in a news release. “In addition, this combination will strengthen our ability to expand and develop new product offerings in a multi-payor approach.”

Signify Health CEO Kyle Armbrester added that the companies are building an “integrated experience that supports a more proactive, preventive and holistic approach to patient care.”

Armbrester will continue to lead Signify Health as part of CVS Health going forward.


In late August, it was rumored that online retail giant Amazon (Nasdaq: AMZN) was in contention for Signify Health after its nearly-$4billion One Medical acquisition from mid-July. Other rumored potential suitors for Signify Health included UnitedHealth Group and Option Care Health.

The most recent move is yet another sign that big companies have their sights set on how care is delivered to older adults, and follows other big acquisitions of at-home care companies, including insurance giant Humana’s (NYSE: HUM) $5.7 billion deal to take full ownership of Kindred at Home last year. And with its One Medical deal, Amazon gained a platform for users to schedule appointments, renew prescriptions and access health records — services that senior living operators are also increasingly trying to coordinate in their communities.

Signify acquired Caravan Health in March of this year, a move that brought 170 providers participating in accountable care organizations (ACOs) for Medicare beneficiaries into the fold and further expanded its value-based care focus.

Signify Health is centered on health risk assessments, value-based care and provider enablement that encompasses 10,000 clinicians nationwide as part of a broad value-based provider network.

“Together with CVS Health, Signify is uniquely positioned to continue to lead the transformation to value-based care. We look forward to the significant impact this transaction will make on health care for years to come,” Signify Board Chairman Matt Holt said in the news release regarding the transaction.

Clearly, the gold rush of major companies entering the health care landscape and who will come out on top in the value-based care arms race is only heating up and senior living providers are taking notice. Leading executives of many companies have signaled the need for “self disruption” in the years to come in order to stay relevant in the ever-changing value-based care landscape.

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