Humana Agrees to Join Cigna Drug-Buying Group for Some Members

(Bloomberg) -- Humana Inc. said it has agreed to buy prescription medicines for some of its members through a purchasing group run by rival Cigna Corp., in a move that the health insurer hopes will help drive down its drug costs.

Beginning April 1, Humana will make pharmacy purchases for its group commercial business through a Cigna group purchasing organization, or GPO, called Ascent, a Humana spokeswoman confirmed in an email to Bloomberg News. Such purchasing collectives allow businesses to pool their buying power and seek discounts from vendors.

“This arrangement will help us leverage scale and buying power to extract deeper price discounts from drug manufacturers and advance affordability for our customers while at the same time preserve our ability to address their specific clinical needs,” Humana spokeswoman Kelley M. Murphy said in an email.

Commercial medical plans account for only a small portion of overall membership at Humana, which is focused on private Medicare Advantage plans for seniors. The company reported about 1.3 million members in commercial medical plans as of Sept. 30, compared with 8.4 million in its Medicare business.

A Cigna spokesperson declined to comment.

Cigna and Humana both sell health insurance and other medical services, including pharmacy benefits. Cigna has expanded its footprint in the pharmacy business since its 2018 acquisition of Express Scripts. In 2019, Cigna announced a three-year deal to work with Prime Therapeutics LLC, a pharmacy-benefit manager owned by Blue Cross and Blue Shield plans.

Cigna executives have described how working with outside partners like Prime can increase purchasing leverage with drugmakers.

“You get more attention at the table with pharma if you're representing more lives,” Tim Wentworth, chief executive officer of Cigna's Evernorth unit, said at a conference in November.

©2021 Bloomberg L.P.