CVS Health got walloped at the outset of 2024 as older adults in its Government-run Medicare plans continue to get a lot more medical care than the company expected.
CVS’ operating income fell by 34% — roughly $1.2 billion — in the first quarter compared with the prior-year period, according to results released Tuesday. The company, which absorbed the health insurer Aetna in 2018, marketed its Government-run Medicare Advantage plans aggressively last year and expanded its geographic reach more than any insurer. Now, that strategy is proving a detriment to its bottom line.
“Clearly, this is a disappointing result for us,” Tom Cowhey, CVS’ chief financial officer, said on the company’s earnings call Wednesday.
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Author: Tara Bannow
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