CVS Health plans to separate its roughly 9,000 pharmacies from its insurance and benefits businesses by the first half of 2028, while keeping much of its health-care group together.
Why CVS is splitting
After acquiring Aetna in 2018, CVS argued that combining an insurer, neighborhood pharmacies, clinics and a large pharmacy-benefit manager could make care easier to access and coordinate. A local pharmacy might be a convenient entry point, and insurance and prescription data could help manage health and costs. That was CVS’s case for combining the businesses, not proof that common ownership would make care cheaper.
In 2024, rising medical costs at Aetna helped force CVS to cut its profit outlook. The company also announced a multiyear cost-cutting effort and changed Aetna’s leadership. Meanwhile, more prescriptions are shifting to delivery, and fewer store visits can mean fewer purchases beyond medicine. These pressures make it harder to manage businesses with different economics.
A new boundary, not a full break
CVS announced the plan as its finances showed improvement, not simply in response to an immediate collapse. Its latest quarterly report showed higher revenue and adjusted earnings, and the company raised its full-year guidance, while cautioning that costs remained elevated. CVS chief David Joyner said separate companies could focus more closely on their customers and businesses. Separate firms may also make performance easier for investors to judge, but whether they will improve care or lower prices is unclear.
Federal Trade Commission staff reports have raised concerns about large pharmacy-benefit managers, or PBMs, and how their ties to affiliated pharmacies may affect competition, drug costs and independent pharmacies. These are staff findings, not a determination that CVS’s split will solve those problems. The plan separates the retail chain from Caremark, but Aetna and Caremark will remain under the same parent, alongside specialty pharmacy and other care businesses. CVS is changing the boundaries of its combined businesses, not abandoning the model.
What patients and investors should know
People with Aetna coverage may still use CVS stores, but the practical relationship between the companies will depend on agreements still to be worked out. A corporate split alone does not change a drug’s price, an insurance benefit or a pharmacy network.
CVS says existing shareholders will own shares in both companies after the separation. It has named Joyner to lead the health-solutions company and Prem Shah to lead CVS Pharmacy. CVS expects to complete the split in the first half of 2028, though details still need to be developed. The test will be whether clearer corporate lines bring better service and measurable savings.