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WOONSOCKET, R.I. — CVS Health introduced a new pharmacy reimbursement model, rebranded its Health Services segment and showcased continued growth opportunities at its annual Investor Day.
“We are successfully executing on our strategy to advance the future of health care while unlocking new value for consumers,” said president and chief executive officer Karen Lynch. “The combination of our businesses, and the key growth areas we have invested in, drive our ability to lower the total cost of care, improve health outcomes, and deliver on our commitments to our customers, consumers and shareholders.”
The company unveiled CVS CostVantage, a new approach that evolves the traditional pharmacy reimbursement model and brings greater transparency and simplicity to the system. The initiative will define the drug cost and related reimbursement with contracted pharmacy benefit managers and payers, using a transparent formula built on the cost of the drug, a set markup, and a fee that reflects the care and value of pharmacy services. These changes will also help ensure that CVS Pharmacy locations will continue to be critical touchpoints for consumers to access affordable health care in their communities.
“We are leading with an approach that will shift how our retail pharmacy is compensated by implementing a more transparent and sustainable model that fairly aligns pharmacy reimbursement to the quality services we provide,” said chief pharmacy officer Prem Shah. “It provides our PBM and payor clients a foundational step towards more pricing clarity for consumers.”
CVS CostVantage will be launched with PBMs for commercial payers in 2025.
Building on the launch of its Choice Formulary program earlier this year, CVS Caremark introduced TrueCost, a model innovation that offers client pricing reflecting the true net cost of prescription drugs, with visibility into administrative fees. Simplified pricing will help consumers be confident that their pharmacy benefit is providing the best possible price and will allow members to have stable access to the PBM’s national pharmacy network. Through this approach, clients will have the flexibility to choose a pharmacy benefit model that works best for the unique needs of their members and plan. The launch of TrueCost is also planned for 2025.
CVS Healthspire will be the new branded name for the Health Services segment, including Caremark, Cordavis, Oak Street Health, Signify Health and MinuteClinic. The groups within CVS Healthspire will continue to focus on integration across the company’s assets to deliver connected patient care, pharmacy benefits and innovative provider support solutions, making expert care simple, more accessible and more affordable. The rollout of the CVS Healthspire brand will begin this month and advance throughout 2024. Consumers will initially see “Part of CVS Healthspire” appear on selected CVS health care delivery offerings.
