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WOONSOCKET, R.I. — CVS Health is cutting 5,000 jobs, according to an article Monday in the Wall Street Journal, that cites a staff memo.
Word of the cost-cutting move, which will reportedly spare workers in customer-facing positions in “stores, pharmacies, clinics, or customer services centers,” came ahead of the scheduled release of the company’s quarterly results on Wednesday.
The report quoted CVS Health chief executive officer Karen Lynch as saying the move would help the company “be at the forefront of a once-in-a-generation transformation in health care.” The memo also said CVS Health plans to reduce travel expenses, cut back on its use of consultants, halt certain business initiatives, and use technology to increase productivity.
“Our industry is evolving to adapt to new consumer health needs and expectations. As part of an enterprise initiative to reprioritize our investments around care delivery and technology, we must take difficult steps to reduce expenses. This unfortunately includes the need to eliminate a number of non-customer facing positions across the company. We do not expect there to be any impact to our customer-facing colleagues in our stores, pharmacies, clinics, or customer services centers. We’re committed to supporting impacted colleagues, and they will receive severance pay and benefits, including access to outplacement services.
We do not anticipate there will be any impact to our clients and customers as we remain focused on our mission – continuing to provide the exceptional care and support our customers, patients and communities deserve and depend on. Throughout our company’s history, we’ve continuously adapted to market dynamics to lead the industry. The difficult decision we are making will set the company up for long-term success,” the company said in a statement.
CVS Health had more than 300,000 employees at the end of last year, most of them in the United States, where it operates more than 9,000 retail outlets and 1,100 clinics. The company’s Aetna unit is a leading health insurance provider, and its CVS Caremark unit is the nation’s largest pharmacy benefit manager.
