CVS Health got walloped at the outset of 2024 as older adults in its 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 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.
