CVS To Close 16 Oak Street Health Centers Amid Industry Cost Issues

Core Insights - CVS Health is closing 16 Oak Street Health Centers, representing 7% of its senior-focused primary care locations in the U.S. [2] - The closures are attributed to elevated medical costs and reflect a broader trend in the healthcare industry, with other companies like Walgreens and Walmart also reducing their primary care operations [3][4] Company Strategy - Despite the closures, CVS remains committed to the Oak Street model, which aims to improve health outcomes for older adults while managing costs [5] - CVS continues to invest in Oak Street Health, emphasizing the importance of value-based care in the healthcare sector [6] Growth and Operations - Since CVS's acquisition of Oak Street Health two years ago, the company has expanded its operations, with plans for more than 300 centers, each potentially contributing $7 million in adjusted EBITDA by 2026 [7] - Under the new CEO David Joyner, CVS has slowed the opening of new Oak Street centers, maintaining 230 centers across 27 states after the closures [8] - The focus is shifting towards growth in existing centers and investment in technology rather than opening new locations [9]