CVS Health is one of several big retailers looking to disrupt traditional healthcare. And after billions of dollars in investments, it has no plans to slow down on that strategy.
In recent years, CVS has poured money into healthcare services, from primary care to clinical trials. President and CEO Karen Lynch, who took the helm in 2021, discussed CVS' expansion plans at an event in Chicago on Tuesday.
Here's what Lynch had to say about the company's strategy.
1. CVS is all in on value-based care
A key part of the company's healthcare services strategy is transitioning from transactional care to a focus on quality and outcomes. “We’re really focusing on value, not activity,” Lynch said.
CVS' $10.6 billion acquisition of primary care provider Oak Street Health in May is one example. Nearly a third of the U.S. population does not have access to a primary care provider, and
Oak Street, which focuses on Medicare patients, is one solution to the lack of access, Lynch said.
CVS made an earlier investment into value-based care in March when it acquired home health and physician enablement technology company Signify Health in an $8 billion deal.
2. The company is bullish on Oak Street
Lynch said she was impressed with Oak Street's data platform and the important role its community centers play for seniors.
"I thought, 'This is what healthcare is.' ... It's being in the community," Lynch said. "I was sold immediately."
Oak Street, led by CEO and co-founder Mike Pykosz, has more than 190 centers across 24 states and aims to open another 50 or 60 locations in 2024.
3. CVS wants to connect the dots across healthcare
CVS' "ambitious and bold" strategy for healthcare services involves creating better care coordination throughout the stages of a patient's healthcare journey and using technology to achieve that, Lynch said. She said CVS has all the assets it needs to make that happen.
Lynch said the healthcare services strategy is a long-term one and won't come together overnight.
4. CVS is looking for smart AI investments
CVS employs AI for tasks such as prescription processing and revenue cycle management, and it's looking for more ways to invest.
Lynch acknowledged the risks of bad actors using AI. She recalled when a colleague and his team members pulled video clips of her speaking at various events and within hours created a deepfake video with her likeness speaking negatively about technology.
"If they can do, in four hours, a real deepfake on me—and sound and look reasonably close—imagine what things people can do," Lynch said. "As leaders, we all need to be incredibly thoughtful on how to protect, but support the advent of this...technology revolution."
5. The company is prioritizing health equity
The pharmacy chain partners with community groups to hire locally, offers screenings for patients in underserved areas and operates several workforce training centers across the U.S.
In January, CVS launched its Community Equity Alliance initiative to address disparities in heart health and mental health outcomes. Meharry Medical College in Nashville, Tennessee, Sinai Chicago and Wayne State University in Detroit signed on as CVS' first partners.
