CVS Health to split pharmacy business from Aetna insurance

· Health · United States

CVS Health will break itself into two publicly traded companies, separating its Aetna insurance and Caremark pharmacy-benefits businesses from its retail pharmacies. The first company, to keep the CVS Health name, will hold the insurance operations, according to Endpoints News. The move reverses years of deal-making built on the idea that combining pharmacies, benefits management and insurance would control costs. CVS is responding to rising costs, retail competition and federal and state scrutiny of vertical integration, STAT reported. The about-face is being read as an indictment of the belief that bigger is always better in healthcare.

Why it matters：The breakup tests whether vertical integration in US healthcare actually delivers savings, and could prompt other insurers and pharmacy chains to reconsider combined models.

Key points

  • Two publicly traded companies will result; the insurance side keeps the CVS Health name
  • The split follows federal and state scrutiny of vertical integration
  • CVS faces rising costs and retail competition

Sources (original reporting)

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