Alyssa Lane
CVS Health Corporation is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain, and several subsidiaries. One of its notable acquisitions is Aetna, a health insurance provider, which CVS purchased for $69 billion in 2018. This integration of CVS's pharmacy services with Aetna's insurance capabilities created a healthcare giant. CVS Health has also been exploring options to separate its retail pharmacy and insurance units, which may result in a potential break-up of the company. As of now, Aetna operates as the insurance subsidiary of CVS Health, offering health insurance plans and related services.
| Characteristics | Values |
|---|---|
| Name of CVS Insurance Subsidiary | Aetna |
| Year CVS acquired Aetna | 2018 |
| Amount paid for acquisition | $69 billion |
| CVS Health's plan to separate its retail pharmacy and insurance units | Under consideration |
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What You'll Learn
CVS Health's subsidiary, Aetna
CVS Health Corporation is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain, CVS Caremark, a pharmacy benefits manager, and Aetna, a health insurance provider.
Aetna, now known as Aetna CVS Health, is an American managed health care company that sells traditional and consumer-directed health care insurance and related services. These services include medical, pharmaceutical, dental, behavioural health, long-term care, and disability plans, primarily through employer-paid insurance and benefit programs, and through Medicare.
In December 2017, CVS announced it had agreed to buy health insurer Aetna for about $207 per share, broken down into $145 in cash and the rest in stock. The acquisition was completed in November 2018, and CVS CEO Larry Merlo was named to run the combined company. The merger allowed CVS to provide a broad range of health services to Aetna's 22 million medical members.
The combined company connects consumers with CVS Health's resources and Aetna's network of providers to help remove barriers to high-quality care. CVS Health's offerings, such as retail pharmacy services, specialty pharmacy, and long-term care, will be fully accessible to other health plans. Additionally, CVS Health will build on its successful Project Health screening events at CVS Pharmacy, and Aetna's commitment to building healthier communities, to offer new preventive health screenings in communities identified as high-risk for certain health challenges.
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CVS Caremark, a pharmacy benefit manager
CVS Caremark is a pharmacy benefit manager and subsidiary of CVS Health, an American healthcare company. CVS Caremark plays a critical role in the healthcare system by helping to lower drug costs and expand coverage to affordable medications.
CVS Caremark manages prescription plans, ensuring that individuals have access to affordable medication when and where they need it. Depending on their insurance, individuals may be able to use their health insurance card when picking up prescriptions at the pharmacy, or they may have a separate card specifically for prescription drug coverage. CVS Caremark offers mail delivery and pickup options for prescriptions, with no delivery fee for 90-day supplies of regularly taken medications.
The company provides a proprietary online search tool that helps members find savings options that work with their prescription plans. Additionally, CVS Caremark offers adherence counselling to ensure that members take their medications as prescribed, helps close gaps in care, and provides disease management support.
CVS Caremark's TrueCost pricing model aims to reduce pricing disparities and help members maximize the value of their purchasing power. The company also promotes the use of generic drugs, expands the availability of biosimilars, and secures significant discounts on brand-name medications. These efforts ensure that Caremark members pay an average out-of-pocket cost of less than $8 for a 30-day supply of medicine.
CVS Caremark has pledged to deliver greater affordability, improve relations with pharmacies, and change the trajectory of drug costs. They aim to make it easier to do business with them by partnering with rural pharmacies, updating technology, and delivering a consistent experience.
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Omnicare, a provider of pharmacy services
Omnicare offers a comprehensive suite of services to support care facilities, ensuring that their partners have the assistance they need to care for residents throughout treatment safely and effectively. Their staff, comprised of qualified pharmacists, detailed pharmacy technicians, and expert consultant nurses, are there to answer questions, provide proactive value-building opportunities, and become a trusted partner throughout all pharmacy management operations.
The Omnicare Clinical Intervention Center (CIC) is an integral part of their services, with technicians and pharmacists tackling formulary issues and increasing facility value. By handling insurance rejections, providing alternative medication recommendations, and implementing cost containment solutions, the CIC gives facilities more time to focus on providing excellent care to their residents.
In addition to their clinical intervention services, Omnicare also provides clinical consultation support, transition of care, and infusion education and services. Their infusion services are particularly noteworthy, as they offer both in-person and virtual education seminars to give facility nursing staff the confidence to admit and manage infusion patients, contributing to staff professional development.
Omnicare was acquired by CVS Health in August 2015 and is operated as a wholly-owned subsidiary of CVS Health Corporation. CVS Health Corporation is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain, CVS Caremark, a pharmacy benefits manager, and Aetna, a health insurance provider. Through its subsidiaries, CVS Health aims to provide a broad range of health services, including insurance plans, prescription delivery, and specialty medication services, to its customers.
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Navarro Discount Pharmacy, a pharmacy chain
Navarro Discount Pharmacy is a pharmacy chain, photo service, and pharmacy benefit manager in the United States. The company was founded in 1940 by José Navarro, Sr. in Havana, Cuba. The first store was located on Monte Street and had a large client base, including the employees of the Power Company of Cuba. After the political change in Cuba in 1961, the government confiscated the Navarro stores, forcing the family to flee to the United States. José Navarro, Sr. then opened a pharmacy in Miami with the money he received from cashing an insurance policy. The company expanded over the years and, as of 2010, had a total of 28 stores.
In September 2014, Navarro Discount Pharmacies was acquired by CVS Health and is operated as a separate brand and business of CVS, headquartered in Miami, Florida. CVS Health is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain, and Aetna, a health insurance provider, among other brands. CVS started in Lowell, Massachusetts, in 1963, selling health and beauty products. Over the years, the company expanded and, by 1967, had opened its first stores with pharmacy departments.
Today, CVS Health is the world's second-largest healthcare company, providing a broad range of health services and products to its customers. In 2017, CVS announced its plans to buy health insurer Aetna, allowing it to offer medical services along with prescription drugs. CVS Health continues to grow and innovate, partnering with companies like Microsoft to improve personalized care and digital health and acquiring other businesses such as Signify Health and Oak Street Health to expand its reach in the healthcare industry.
Navarro Discount Pharmacies, as a subsidiary of CVS Health, benefits from the resources and infrastructure of its parent company while maintaining its separate brand identity and business operations. With CVS Health's support, Navarro Discount Pharmacies can further enhance its services and contribute to the healthcare landscape in South Florida and beyond.
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CVS's potential break-up of its retail and insurance units
CVS Health Corporation is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain; CVS Caremark, a pharmacy benefits manager; and Aetna, a health insurance provider, among many other brands.
CVS has been considering a breakup of its retail pharmacy and insurance units, according to reports from Reuters and The Wall Street Journal. The company has been under pressure from investors and struggling with poor financial performance. The board is reviewing how a breakup would work financially and whether the CVS Caremark pharmacy benefits management unit would be paired with the retail pharmacies or insurance side of the business.
A breakup would be a significant shift for CVS, which has spent billions of dollars on acquisitions to become a one-stop health destination. The company's $70 billion acquisition of Aetna in 2017-2018 was a key part of this strategy, allowing CVS to provide a broad range of health services to Aetna's 22 million medical members.
However, CVS's insurance business has faced challenges, with its Medicare business underperforming due to rising medical service costs. As a result, CVS initiated a $1 billion cost-cutting plan, which included layoffs affecting 2,900 jobs, primarily at the corporate level.
Some analysts argue that a breakup is unlikely due to the operational complexities and potential loss of customers and revenue. Carving up contracts across business units and separating vertically integrated business segments could be challenging. Additionally, the pharmacy benefits manager unit, Caremark, sits at the intersection of CVS's retail and insurance operations, and its placement in the event of a breakup is unclear.
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Frequently asked questions
CVS Health's insurance subsidiary is called Aetna.
Aetna creates insurance plans that deliver affordable and connected healthcare.
CVS Health acquired Aetna for $69 billion in 2018 to combine its pharmacy services with Aetna's insurance capabilities.
