Home Health CVS Health is cutting 2,900 jobs, but mom is in danger of splitting up

CVS Health is cutting 2,900 jobs, but mom is in danger of splitting up

by trpliquidation
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CVS Health is cutting 2,900 jobs, but mom is in danger of splitting up

CVS Health confirmed plans to cut about 2,900 jobs, or less than 1% of its total workforce, as the diversified provider of medical care, pharmacy services and health insurance faces cost pressures.

However, company executives would not confirm reports that they were considering splitting, spinning off or selling the company, which includes the major chain of CVS drugstores; Caremark, one of the largest pharmacy benefit management companies in the country; and Aetna, the nation’s third largest health insurer.

“Our industry faces continued disruption, regulatory pressures and changing consumer needs and expectations, so it is critical that we remain competitive and deliver top performance,” CVS said in a memo to employees on Monday. “As we previously announced, we have embarked on a multi-year initiative to deliver $2 billion in cost savings by reducing costs and investing in technologies to improve the way we work. To achieve this goal and position ourselves for sustainable growth, we will reduce our workforce by less than 1 percent – ​​approximately 2,900 colleagues within CVS Health.”

CVS said the affected positions are “primarily corporate functions,” while “frontline jobs” in stores, pharmacies and distribution centers would be spared. “Before taking this step, we prioritized finding cost savings wherever we could, including closing open positions,” CVS said.

It is CVS’s latest attempt to make improvements to its business operations. In August, the company said CVS Health CEO Karen S. Lynch would take over the “day-to-day management” of the company’s Aetna health insurance business after the latest poor performance.

Lynch, who successfully led Aetna for several years before being promoted to CVS president and CEO in 2021, oversees the nation’s third-largest health insurer. Tom Cowhey, chief financial officer of CVS Health.

Reuters reported this earlier this week that CVS is “exploring options that could include a split of the business to separate its retail and insurance units.”

For its part, CVS said the company’s management team and Board of Directors are continuously exploring ways to create shareholder value.

“We remain focused on improving performance and delivering high-quality healthcare products and services, enabled by our unparalleled scale and integrated model,” the company added.

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