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Cigna’s $2.5 Billion Stake In VillageMD’s Summit Venture To Grow Evernorth Provider Portfolio

Health insurance giant Cigna is investing $2.5 billion into VillageMD’s Summit Health acquisition to grow its Evernorth portfolio of health services.

Cigna’s share, which was disclosed Monday night in a filing with the Securities and Exchange Commission, is part of Walgreens-backed VillageMD’s $8.9 billion acquisition of Summit that was announced Monday morning. The Cigna investment adds a new national network of medical care providers to the health insurer’s Evernorth portfolio, which already includes Express Scripts, one of the nation’s largest pharmacy benefit management companies.

“Together with VillageMD, we intend to create a value-based care model with access to networks of quality primary care physicians and specialists – wrapped with Evernorth’s suite of health services – to unlock additional value for our clients and customers,” Evernorth chief executive officer Eric Palmer said.

Evernorth executives say they will bring a suite of health services to VillageMD’s physicians and patients that include “dedicated pathways to specialty care capabilities such as chronic condition management” and behavioral physicians. VillageMD operates more than 250 primary care practices across 22 markets and continues to roll out more doctor-staffed clinics attached to Walgreens drugstores.

“VillageMD’s physicians will also benefit from Evernorth’s real-time data and clinical insights at the point of diagnosis to help them determine the optimal treatment paths,” Evernorth said in a statement on its website. “The patients we mutually serve will also benefit from MDLIVE’s virtual urgent, behavioral, dermatology and primary care services – enhancing the care they receive at VillageMD, and reducing any unnecessary burden on VillageMD physicians for health issues that can be addressed virtually.”

VillageMD could also benefit from its relationship with Cigna health plan members that total about 18 million as of the end of the second quarter.

“From where we sit at the intersection of physicians, payers, pharmacies and patients, Evernorth has unparalleled insights on each patient’s health care journey,” Palmer said. “This data helps us to support patients at critical moments of care.”

Terms of the transaction also call for Walgreens Boots Alliance to “invest $3.5 billion through an even mix of debt and equity to support the acquisition of Summit Health-CityMD,” Walgreens said Monday. “Walgreens Boots Alliance will remain the largest and consolidating shareholder of VillageMD with approximately 53 percent ownership.”