CVS Health Corp. (NYSE:CVS) is reportedly seeking a private equity partner to fund the expansion of Oak Street Health, the $10.6 billion primary care provider it acquired last year.
The company is working with financial advisers to secure capital for new Oak Street clinics and is contacting several private equity firms about a potential joint venture.
Oak Street Health focuses on serving seniors in privately managed Medicare plans.
The new clinics typically incur losses for the first few years while recruiting patients. A joint venture could help manage these initial losses by taking them off CVS' balance sheet, Bloomberg noted, citing the sources.
Healthcare companies have employed similar strategies in the past. For instance, Humana Inc. (NYSE:HUM) and Welsh Carson Anderson & Stowe formed joint ventures in 2020 and 2022 to develop primary care clinics.
In these arrangements, Humana could buy back its interest over time while ensuring Welsh Carson a guaranteed return. CVS is reportedly considering a similar structure.
Citing RBC Capital Markets analyst, Bloomberg highlighted that this potential partnership could be a strategic move to protect CVS's credit ratings and liquidity, while shielding earnings from startup losses as the company scales its primary care platform.
The analyst also highlighted the benefits of deferring a portion of clinic investment.
The Medicare Advantage business has historically driven growth for health insurers, but recent changes may slow this trend.
The Biden administration has tightened payments to these plans and altered reimbursement methods to address perceived abuses.
Additionally, seniors are returning to clinics and hospitals for elective procedures deferred during the COVID-19 pandemic, which is impacting the revenues of risk-based primary care providers.
Price Action: CVS shares are up 0.47% at $56.91 at the last check on Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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據報道，CVS Health Corp.（紐約證券交易所代碼：CVS）正在尋找私募股權合作伙伴，爲其去年收購的106億美元初級保健提供商橡樹街健康的擴張提供資金。
該公司正在與財務顧問合作，爲橡樹街的新診所籌集資金，並正在就潛在的合資企業與幾家私募股權公司聯繫。
橡樹街健康專注於通過私人管理的醫療保險計劃爲老年人提供服務。
新診所在招募患者的最初幾年通常會蒙受損失。彭博社援引消息人士的話指出，合資企業可以通過將這些初始損失從CVS的資產負債表中扣除來幫助管理這些損失。
醫療保健公司過去也採用過類似的策略。例如，Humana Inc.（紐約證券交易所代碼：HUM）和威爾士卡森安德森和斯托在2020年和2022年成立了合資企業，以開發初級保健診所。
在這些安排中，Humana可以隨着時間的推移回購其權益，同時確保威爾士卡森獲得有保障的回報。據報道，CVS正在考慮類似的結構。
彭博社援引加拿大皇家銀行資本市場分析師的話強調，這種潛在的合作伙伴關係可能是一項戰略舉措，旨在保護CVS的信用評級和流動性，同時在公司擴大其初級保健平台時保護收益免受創業公司虧損。
該分析師還強調了推遲部分診所投資的好處。
Medicare Advantage業務歷來推動健康保險公司的增長，但最近的變化可能會減緩這一趨勢。
拜登政府收緊了對這些計劃的付款，並修改了報銷方法，以解決明顯的濫用行爲。
此外，老年人正在返回診所和醫院接受在 COVID-19 疫情期間推遲的選擇性手術，這影響了基於風險的初級保健提供者的收入。
價格走勢：在週五的最後一次支票中，CVS股價上漲0.47％，至56.91美元。
免責聲明：此內容部分是在人工智能工具的幫助下製作的，並由Benzinga的編輯審閱和發佈。
