CVS and the doctoring business, Sochi consequences, and getting Cohen’s side of the story

February 11, 2014

1. How far can CVS and other pharmacy chains get into the doctoring business?

In announcing Wednesday that CVS Caremark would stop selling tobacco, chief executive officer Larry Merlo said selling cigarettes would be, according to a company press release, “inconsistent with our purpose.” He explained, “As the delivery of health care evolves with an emphasis on better health outcomes, reducing chronic disease and controlling costs, CVS Caremark is playing an expanded role in providing care through our pharmacists and nurse practitioners.”

I’d like to know more about what Merlo has in mind vis a vis that “expanded role in providing health care.”

Drugstore chains like CVS, Rite Aid and Walgreens already offer flu shots. How is that regulated? Is it allowed in all states? Do licensed nurses have to provide them? Did doctors’ groups or health clinics lobby against it?

How else might CVS and its competitors use its pharmacists and nurse practitioners? How much can nurses do before a doctor is required? (And, again, how does that vary by state?) Do any drugstore chains have plans to put doctors on duty? Have any done so?

Finally, with hospitals now expanding their reach and control of their markets by buying competing hospitals as well as doctors’ practices, are any partnerships in the talking or planning stages between dominant hospital systems in various regions of the country and one or more of these drug chains? Imagine the expanded footprint a hospital system would have if it had an outpost in hundreds of retail outlets.

Last question: The Caremark part of CVS Caremark is a giant pharmacy benefits manager, or PBM. PBM’s negotiate deals to buy prescription drugs on behalf of insurance companies and large employers that provide health coverage for their workers through self-insurance. They then administer the drug portion of health insurance benefits to employees and others with insurance coverage. They are now often the people you argue with when you’re told that some drug you need isn’t covered.

The Caremark PBM operation is a bigger business for CVS Caremark than the drugstores. So, if CVS plans to expand its healthcare services, its parent company already has a line into a huge portion of the insurance market.

Could it be planning programs by which people who don’t feel well are encouraged to stop in at the local CVS before they see a doctor or go to an emergency room — thereby saving on the insurance companies’ coverage costs?

2. Sochi consequences:

All the hilarious tales (hilarious unless you’re there) coming out of Sochi about still un-built hotels and other facilities, brown drinking water, wild dogs, and missing lightbulbs and door knobs, cry out for one story that would have to keep a reporter in Russia once the Olympic games are over: What will the consequences be for the people responsible for this debacle?

In the United States we’d have endless congressional hearings aimed at nailing those who screwed up so badly that — even with seven years’ lead time — the hotels were still under construction as the athletes arrived for the games. In President Vladimir Putin’s Russia, we can probably assume consequences more dire than having to endure hundreds of flashbulbs a day on C-Span and the staged outrage of a bunch of politicians.

A good reporter ought to hang around to chronicle all that.

3. Getting Cohen’s side of the story:

With the insider trading conviction last week of yet another trader at Steven A. Cohen’s hedge fund, SAC Capital Advisors, lead prosecutor Preet Bharara’s charge that the firm was a “veritable magnet for market cheaters” seems irrefutable.

So what is Cohen’s side of the story? How does he explain all the convictions against the backdrop of his funds’ outsized success over the years? Some of the best stories are those that ferret out the other guy’s version of reality — however unreal.

I still remember, for example, furiously scribbling down the complaints of the wife of an unambiguously murderous mobster, who was insisting he was a persecuted labor leader framed by captains of industry.

Sure, it would be great to get an interview with Cohen. But his lawyers are likely to block that, even if he were so inclined. Yet why can’t a reporter try — even if it means staking out places Cohen frequents?

Failing that, why not find out what Cohen’s been telling his friends? The New York Times reported last week, “At one point during Mr. Martoma’s [the Cohen lieutenant convicted last week] trial, Mr. Cohen, a noted art collector, attended a New York Knicks basketball game at Madison Square Garden with the art dealer Larry Gagosian.”

Maybe Gagosian would talk if granted anonymity. Surely, some people who have talked to Cohen would.

His communications with investors might also be good sources for his side of the story. What has he written to them since the investigations started? How did he explain his great trades in what had been regular written reports to them before the investigations started?

PHOTO (TOP): Furniture is pictured in front of a hotel at the village of Esto Sadok at the Rosa Khutor alpine resort near Sochi, February 6, 2014. REUTERS/Michael Dalder 

PHOTO (INSERT): Hedge fund manager Steven A. Cohen, founder and chairman of SAC Capital Advisors, responds to a question during an interview session at the SkyBridge Alternatives (SALT) Conference in Las Vegas, Nevada, May 11, 2011. REUTERS/Steve Marcus 


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