CVS Health Corp. announced Jan. 15 that Walmart Inc. has decided to leave drugstore networks operated by its pharmacy benefit management unit, CVS Caremark, due to disagreements over pricing.
"While we have enjoyed a long relationship with Walmart as a low-cost provider in our broad national networks, based on our commitment to helping our clients and consumers manage rising pharmacy costs, we simply could not agree to their recent demands for an increase in reimbursement," CVS Caremark President Derica Rice said. Walmart has requested an increase in its reimbursement rates that Rice emphasized would "ultimately result in higher costs for our clients and consumers."
The exit only covers Walmart's participation in the CVS Caremark commercial network and the Managed Medicaid pharmacy network. It does not affect the company's participation in the CVS Caremark Medicare Part D pharmacy network, in its Sam's Club division or in any of the drugstore networks.
CVS Caremark has requested that Walmart remain in its network until April 30. The pharmacy benefit management unit intends to ensure a smooth transition for affected clients who will be notified and given access to information that can help them shift to another in-network retailer.
Parent company CVS does not expect the decision to have a material impact on its financial results in 2019.
According to a report by The Wall Street Journal, a spokeswoman for the Bentonville, Ark.-based retailer said the company is "trying to find a solution that benefits all parties." She explained that Walmart is "committed to providing value to our customers across our business, including our pharmacy, but we don't want to give that value to the middleman."