Inside CVS' physician acquisition strategy

CVS has made two major physician acquisitions since January, investing in physician and primary care groups to accelerate its growth. 

The company is known for its in-store MinuteClinics for vaccinations and urgent care but lacks offices for annual checkups with clinicians. CVS Health aims to change that by forming partnerships with or acquiring a stake in a primary care company to offer more services.

In March, CVS Health completed its $8 billion acquisition of Signify Health, adding more than 10,000 clinicians to its network. Signify uses analytics and technology to support in-home care, evaluations and service coordination for employers, physician groups, health systems and health plans, including dozens of Medicare Advantage plans.

In February, CVS entered a $10.5 billion definitive agreement to acquire Oak Street Health, a primary care network for Medicare members. Chicago-based Oak Street manages a value-based primary care network with more than 160 clinics in 21 states that primarily focus on Medicare beneficiaries. 

The Oak Street acquisition will expand CVS' footprint in primary care — the clinics also accept most major payers, including Humana, Cigna, Anthem, UnitedHealthcare and Blue Cross Blue Shield. 

Also in January, CVS Health Venture invested $100 million in Carbon Health, a hybrid healthcare company focused on primary and urgent care, and led a $25 million financing round for virtual therapy and psychiatry company Array Behavioral Health. 

Although CVS said in May it will not pursue any major acquisitions in the near future following its two major acquisitions. 

"I think over time we'll look at other assets, but right now we need to focus on execution of the assets that we just acquired," President and CEO Karen Lynch told investors during the company's first-quarter earnings call May 3. "As you think longer term around the corner, there might be additional opportunities in the home or health services and tech."

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