CVS: Your Friendly, Neighborhood...Doctor?

CVS Looks To Make Its Drugstores A Health Care Destination

NPR, ALISON KODJAK

When it comes to making changes in health care, CVS Health isn't settling for tinkering around the edges. The company is looking to strike at the heart of how health care is delivered in the U.S.

In November, the drugstore chain completed a $70 billion acquisition of health insurance giant Aetna that CVS has said will change the company and in the process alter the way consumers experience health care.  

"We're trying to transform the industry," says Dr. Alan Lotvin, executive vice president for transformation for the company. The health care industry, he says, is now organized for the convenience of doctors, hospitals and other providers of care. "I think there's an opportunity to organize around the consumer," Lotvin says. 

With almost 10,000 retail stores across the country, CVS says it is already where consumers are. Now, with the addition of Aetna, CVS also provides health coverage for 22 million people.  

CVS plans to transform some of its stores and their existing retail clinics into hubs that will offer more health care services and products. The company put its first test locations in areas with lots of Aetna patients, in hopes of directing patients away from expensive emergency rooms to the stores' less pricey MinuteClinics.

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The Continued Strength of the Retail Pharmacy Sector

If investors are anything like the average net lease property owner, they might find a retail pharmacy is a solid investment. Even better news is that this investment will likely continue providing a reasonable rate of return.

By Jonathan Hipp | January 14, 2019 at 04:00 AM

Think about your neighborhood retail pharmacy. Perhaps it’s a stand-alone Walgreens on a busy street corner, or a CVS on a pad site, shadow-anchored by a big-box retailer. If you’re anything like the average consumer, this pharmacy offers a handy location for prescriptions, health and beauty products, and groceries.

If investors are anything like the average net lease property owner, they might find a retail pharmacy is a solid investment. Even better news is this investment will likely to continue providing a reasonable rate of return.

During much of the early to mid-20th century, people filled prescriptions at the local pharmacy. These independently owned operations also offered over-the-counter remedies, a small line of packaged goods, magazines, candy, and some locations had old-fashioned soda counters.

Today’s retail pharmacy isn’t your grandfathers’ neighborhood drug store.

Over the past several decades, these establishments morphed from independent ownership to operations that are, for the most part, in the hands of national chains. This, in turn, has meant more front-of-store offerings.

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