Walgreens investment ‘endorsement’ of CareCentrix model, CEO says

HARTFORD, Conn. – Walgreens’ investment in CareCentrix will accelerate the ongoing shift of health care to the home, says CareCentrix CEO John Driscoll.  

Walgreens Boots Alliance announced Oct. 14 that it plans to acquire a majority share of CareCentrix, investing $330 million for a 55% stake, and is investing $5.2 billion in VillageMD, a primary care provider, to launch Walgreens Health.  

“COVID has underscored for everyone that we need to deliver more care in the home and we can,” he said. “We’ve been developing our business around the country and to have Walgreens endorse and embrace (our model) and expand our business is really exciting.”  

CareCentrix currently manages care for 19 million members through a network of approximately 7,400 provider locations, providing home medical equipment, home health care, home infusion services and medication management. Walgreens has more than 9,000 retail pharmacy locations.  

The deal will both expand CareCentrix’s business and raise its profile, says Driscoll.  

“In Walgreens, CareCentrix gains a sophisticated mega-pharmacy partner, an aggressive health care investor and a brand name health care leader that is supporting CareCentrix programs and services across the country,” he said. “Walgreens has really endorsed our mission, but I want to underscore, they’ve endorsed CareCentrix's role in trying to accelerate what that means as we grow our value-based business.”  

CareCentrix has reduced total cost of care for members by 20%, including a greater than 11% reduction in emergency department usage and a 23% reduction in skilled nursing costs.  

“We’ve got purpose-built analytics that allow us to identify the biggest gaps in care for patients and opportunities for providers, we’ve got a great network of providers that we’re constantly curating, and we have people that are focused on delivering the care that patients need whether clinical or non-clinical,” he said.  

Downstream of the investment and its immediate impact for CareCentrix, the company’s network of providers will also benefit greatly, says Driscoll.  

 “Too frequently, health plans still look at HME as more of a cost center than a value-based center,” he said. “It’s hard for providers who are billing and negotiating on an individual code basis, but the opportunity to partner with Walgreens to take on more risk, we’re going to share more of that with our network providers and deal them in.”