CVS Concept Stores to Open in 2019, Focus on Cutting Medical Costs

CVS Pharmacy photo

Once the CVS Health-Aetna merger is officially completed (expected to be around Thanksgiving), the retail chain will turn its attention to opening its first "health hub" concept stores early next year. And some wonder whether this will be a precursor to CVS moving into urgent care by adding X-ray imaging, infusion therapy and phlebotomy services — moves that could meet the retailer's stated goal of substantially reducing medical costs for its employees and Aetna plan members.

CNBC reports that CVS CEO Larry Merlo told Wall Street analysts recently that the concept stores will focus on four areas to reduce medical costs for the combined company. These include:

  • Managing five common chronic conditions — diabetes, hypertension, cardiovascular disease, asthma and behavioral health.
  • Optimizing and extending primary care, including expanding the scope of services available at CVS' MinuteClinics to help identify and manage chronic diseases.
  • Reducing avoidable hospital readmissions by combining Aetna's clinical programs with CVS stores to guide patients when they're discharged.
  • Managing such complex chronic conditions as kidney disease.

Information gathered from the concept stores will inform CVS as to which programs are the most effective, so that they can be scaled across the company's 10,000 stores and 1,100 MinuteClinics. Initially, CVS will focus on Aetna members but later hopes to develop an open-platform model for longer-term growth.

One burning question that some analysts have begun to ask is whether CVS will move from its MinuteClinic model to a full-service primary and urgent care model to treat routine conditions. This would enable CVS to compete directly with Walgreens Boots Alliance, which has opened urgent care clinics with UnitedHealth Group's MedExpress urgent care unit. If CVS does move into urgent care alongside its rival Walgreens, this could bring increased competition for hospitals from the well-financed retailers.

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