CVS Health plans to divide its healthcare business into two publicly traded companies, separating its approximately 9,000 retail pharmacies from its insurance and pharmacy-benefit operations. The CVS Health business split will create one company focused on retail and mail-order pharmacies and another housing health insurer Aetna and pharmacy benefit manager Caremark.
The restructuring decision marks a major reversal of CVS’s acquisition-led expansion strategy, which brought insurance, pharmacy services, and healthcare delivery under one corporate structure. According to The Wall Street Journal, the separation is targeted for early 2028.
CVS CEO David Joyner said, “the businesses would be better positioned to operate independently.”
What Will the 2 Companies Do After CVS Health Business Split?
Under the proposed CVS Health restructuring, the company will divide its operations into two separate businesses. Both companies will have distinct management structures and publicly traded shares.
1. CVS Health to Retain Aetna and CVS Caremark
The first company will retain the CVS Health name and operate under current CEO David Joyner. It will include:
- Aetna: CVS’s health insurance business, serving individuals and employers.
- CVS Caremark: Its pharmacy benefit management (PBM) business, which manages prescription drug benefits for health plans, employers, and other clients.
- Oak Street Health: A network of primary care clinics.
- Signify Health: A business providing home-based healthcare services.
- Specialty-drug operations: Services focused on medications used to treat complex and serious conditions.
CVS expects these businesses to continue working together, particularly through the relationship between Aetna and Caremark.
2. CVS Pharmacy to House the Retail Pharmacy Business
The second company, expected to operate as CVS Pharmacy, will manage the consumer-facing pharmacy operations.
CVS Pharmacy business will include:
- Approximately 9,000 retail pharmacy locations across the United States.
- Mail-order pharmacy services.
- MinuteClinic healthcare services.
The CVS retail pharmacy spin-off will allow the pharmacy business to operate independently of the insurance and PBM operations. However, selected commercial agreements will continue to connect the two companies.
Why Is CVS Health Restructuring Its Business?
The CVS Health restructuring reverses a strategy built around combining different healthcare services under one company.
In 2018, CVS acquired health insurer Aetna for approximately $78 billion. The acquisition aimed to connect insurance coverage, prescription drug services, and patient care to improve efficiency and potentially lower healthcare costs.
CVS also expanded its healthcare services through acquisitions, including Oak Street Health and Signify Health.
However, the company has faced financial and operational challenges across its businesses. Aetna has experienced pressure from rising medical costs and changes in its insurance offerings, while retail pharmacies face increasing competition from online prescription delivery services.
CVS had also explored a potential business separation in 2024 as it dealt with financial performance challenges. The latest decision of the CVS Health business split represents a significant change in its long-term corporate strategy.
How Does Regulatory Scrutiny Add Pressure to CVS’s Business Model?
The CVS Health business split comes as pharmacy benefit managers face increasing scrutiny from US lawmakers and regulators.
PBMs act as intermediaries between health insurers, employers, pharmacies, and drug manufacturers. They manage prescription drug benefits and negotiate aspects of drug pricing and pharmacy payments.
However, critics argue that companies owning insurance businesses, PBMs, and retail pharmacies can create potential conflicts of interest and weaken competition.
The Federal Trade Commission (FTC) reached a settlement with CVS earlier in 2026 that restricts certain Caremark business practices involving other pharmacies. US regulators are also pursuing greater transparency around how healthcare companies price services and generate revenue.
Some states have considered or introduced restrictions on shared ownership of PBMs and pharmacies.
However, Joyner told the WSJ that regulatory concerns were not driving the CVS Health business split.
What Lies Ahead for CVS Health?
With the CVS Health business split, CVS aims to give each company greater operational focus. Its long-term impact on investors, pharmacy services, and healthcare consumers will become clearer as CVS moves toward completing the restructuring.
However, the CVS Aetna separation also presents financial challenges. The companies may lose some operational benefits from sharing resources, technology, and services, while establishing independent corporate structures could increase costs.
