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CVS (CVS) CEO David Joyner has an ambitious plan to revamp the company's retail healthcare business and create a more integrated system of health professionals, which would change the way pharmacists, Minute Clinic nurses, and Oak Street physicians interact with each other.
The goal, Joyner told Yahoo Finance, would be to have a greater impact on the overall health of communities CVS serves by leveraging what he views as a large labor pool.
"I look at the 30,000 pharmacists that are employed in CVS retail, combined with one of the largest workforces of nurses around Minute Clinic, and then you add on top of that the Oak Street ... physicians. We have become a very large care delivery model in this country," he said.
Minute Clinics are CVS's in-store health services, available at more than 800 locations, which include vaccine administration and quick checkups like flu or other respiratory virus tests. Oak Street is a primary care service for seniors that CVS acquired for $10.6 billion in 2023.
The idea to unify all health professionals borrows from other large health entities, like competitor UnitedHealth Group (UNH) — which currently employs 10% of US doctors under its Optum brand. But unlike United, which has bought up traditional physician practices, CVS is focused on growing its retail health footprint, at a time when retail health has taken some hits.
The growth comes at the same time that CVS is closing nearly 900 stores in low-performing areas, a similar strategy to other retail pharmacies.
Walmart (WMT), for example, folded its retail health clinics last year, and Walgreens (WBA) has announced plans to sell its service provider, VillageMD, this year.
In this environment, Joyner thinks CVS is well-placed to build out more retail health offerings. He explained it is because pharmacists are underutilized, based on their healthcare knowledge — a view shared by competitor Walgreens' CEO Tim Wentworth. Joyner believes he can better apply pharmacists' skills and possibly get them paid through different reimbursement models.
He used the volume of vaccine administration during the pandemic as an example of allowing pharmacists to "practice at the top of their license."
"Pharmacists today are essentially paid off a drug margin, and so I would argue that they have been somewhat commoditized at the expense of ... a really high-value, highly frequented healthcare service," Joyner said.
"Ultimately, with the shortage of primary care in this country, my goal is to continue to elevate the role of the pharmacy and the communities. And then that will be complemented with the Minute Clinic services adding additional primary care offerings. And then, ultimately moving all the way to the value-based care model," Joyner said.