Humana Could Create ‘End-to-End’ Senior Care with Walgreens, Kindred at Home

Humana (NYSE: HUM) could be close to creating an “end-to-end health care experience for American seniors,” supported by its Kindred at Home ownership and a potential joint venture with Walgreens Boots Alliance (NYSE: WBA).

That’s according to a Nov. 20 note from Leerink analysts; the note was issued after a Wall Street Journal report that Humana and Walgreens are in talks and could take equity stakes in each other.

On Wednesday night, Walgreens Executive Vice Chairman and CEO Stefano Pessina said that the two companies are indeed in negotiations, Forbes reported.


Last June, Humana and Walgreens began piloting senior-focused health clinics located in Walgreens stores in Kansas City, Missouri. Now, the companies are considering how to expand this initiative, including through a joint venture, a commercial agreement, or some other type of partnership, Pessina said Wednesday at the Forbes Healthcare Summit in New York City.

The Kansas City pilot involves Humana employees stationed inside the Walgreens stores to help Humana’s Medicare Advantage members and other seniors in accessing a range of services.

“Closer integration would allow seniors to enjoy primary care in store in addition to the broad array of HUM ex-store services, and drives foot traffic for broader WBA merchandise,” the Leerink analysts wrote in their Nov. 20 note.


Humana’s broader services include home health care through Kindred at Home; the insurance giant acquired a 40% ownership stake in Kindred at Home in early 2018. More recently — at the Morgan Stanley Healthcare Conference in September — Humana CFO Brian Kane said that there are opportunities to integrate Kindred at Home more closely with the Walgreens initiatives.

Ultimately, it is seniors’ homes — not pharmacies — where Humana is most focused, and services in Walgreens or other community locations would be designed to support seniors’ ability to age in place in their own homes, Leerink believes.

“While HUM has been piloting these retail clinics, the strategic commitment remains focused on the home as a care setting for seniors,” the firm’s note states.

It’s a point that Humana Chief Medical Officer Roy A. Beveridge has repeatedly emphasized in speaking with Home Health Care News.

“You have to go where the member or the patient is,” he told HHCN earlier this month. “Patients spend 98% to 99% of their time in their homes, so for us to believe that we can help someone in their health and not be where they are most of the time doesn’t make any sense.”

A closer relationship between Walgreens and Humana could also help the companies compete with rivals Aetna (NYSE: AET) and CVS Health (NYSE: CVS). On Wednesday, pharmacy company CVS completed its nearly $70 billion acquisition of insurer Aetna. As a result of the deal, CVS reportedly plans to focus more store space on health care as opposed to retail.

A complete acquisition is not likely to occur between Walgreens and Humana, however.

“Today, the multiples of the insurance companies are much higher than our multiples,” Pessina said at the Forbes event. “We should have bought it four years ago when our multiple was higher than their multiple.”

Written by Tim Mullaney

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