As the pharmacy giant CVS opens new “health hub” stores in the U.S., the company said the addition of Aetna is boosting profits almost a year after the drugstore chain bought the nation’s third-largest health plan.
CVS Wednesday said profits jumped 10% in the third quarter to $1.5 billion, or $1.84 per share. Revenues jumped 36% to $64.8 billion in the third quarter thanks largely to the addition of Aetna and its health insurance businesses compared to $47.5 billion in the third quarter of last year.
CVS, which completed its acquisition of Aetna in December of last year, is now focused on rolling out the HealthHub stores in four U.S. metropolitan areas and 50 locations by the end of this year.
CVS chief executive officer Larry Merlo said the company is seeing new benefits in new customers and sales after the first eight months HealthHubs were in operation in Houston where the first such stores were launched. In Houston, Merlo said the health hubs are “outperforming” against a control group of traditional stores.
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CVS earlier this year began to pilot three “HealthHUB” locations in Houston that dedicate more than 20% of the store to health services that include new durable medical equipment, supplies and various new product and service combinations. CVS is adding thousands of new personal care items as well as additional services at its MinuteClinics in the health hub stores.
CVS executives told analysts on a call to discuss earnings Wednesday that they are pitching HealthHub services to employer clients now as they discuss future health benefit packages.
CVS said the HealthHub rollout will grow to 1,500 locations by the end of 2021, or about 500 HealthHubs a year.