CVS Health Plans to Split Its Retail Pharmacies from Aetna and Caremark

For someone who stops at CVS every month to pick up a prescription, the first question about Wednesday’s announcement is a simple one: Can I still get my medicine at the same pharmacy? CVS Health says patients will continue receiving prescriptions, care and benefits during the transition. The company is planning a change in who owns the businesses behind those services, with a target date in the first half of 2028.

CVS Health announced from Woonsocket, Rhode Island, that it intends to divide into two independent, publicly traded companies. One would run the retail pharmacies most customers know from their neighborhoods, along with MinuteClinic. The other would include Aetna, which provides health insurance, and CVS Caremark, which manages prescription drug benefits. The proposal comes nearly eight years after CVS completed its purchase of Aetna.

What would go with the pharmacies

The retail company would be called CVS Pharmacy. It would include about 9,000 pharmacies, mail pharmacy services and MinuteClinic, including virtual visits. Prem Shah, currently a group president at CVS Health, would lead it. CVS says the pharmacy business could pursue more partnerships with insurers, drug manufacturers and pharmacy benefit managers once it operates as a separate company.

The company that includes Aetna would use the CVS Health name for now. It would also include CVS Caremark, CVS Specialty, Oak Street Health and Signify Health. David Joyner, the current chairman and chief executive of CVS Health, would lead that business.

The distinction between CVS Pharmacy and CVS Caremark is easy to miss when both carry the CVS name. CVS Pharmacy is the business that fills prescriptions at the store. Caremark manages prescription benefits for health plans. Under the proposal, the pharmacy counter and the business that administers those benefits would have separate owners, while Caremark and Aetna would remain under the same corporate roof.

Why CVS is changing course

When CVS bought Aetna in 2018, the company’s pitch was that an insurer, a pharmacy chain and neighborhood clinics could work together to make care easier to get. It described the local pharmacy as a place where patients might connect with other services and get help managing their care.

Eight years later, CVS says the two businesses would benefit from having more room to make their own decisions. The pharmacy chain could work with a broader range of partners, while the company that includes Aetna would keep insurance, prescription benefits, primary care and services delivered in patients’ homes together. CVS says the new structure could improve access and affordability. Its announcement did not specify changes to what patients pay at the counter or which pharmacies their plans cover.