CVS Invests $20B in Tech for Interoperability, Joins CMS Health Tech Ecosystem Initiative

CVS Health is investing $20 billion in technology over the next decade to address interoperability challenges in the US healthcare system. The company has joined over 60 healthcare and tech companies supporting the CMS Health Tech Ecosystem initiative. CVS has also launched Aetna Care Paths, a digital offering that provides personalized care recommendations and cost tracking tools. UnitedHealth Group is also advancing digital healthcare with AI applications in production across its insurance, health delivery, and pharmacy units.

CVS Health has announced a significant investment in technology, committing $20 billion over the next decade to address interoperability challenges within the U.S. healthcare system. The company aims to create an open platform that allows seamless access to payers, providers, pharmacy benefit managers (PBMs), pharmacies, and digital health tools. This initiative is part of the broader CMS Health Tech Ecosystem initiative, which CVS Health joined alongside over 60 healthcare and technology companies, including Amazon, Anthropic, Apple, Google, and OpenAI.

Tony Ambrozie, CVS Health's senior vice president, described this collaboration as a once-in-a-lifetime opportunity to transform healthcare. He emphasized that the private sector and government collaboration is crucial to developing a healthcare system that truly serves patients.

In addition to its technological investments, CVS Health has also launched Aetna Care Paths, a digital offering available to members through the Aetna Health app. This technology provides clear information about procedures and benefits, tailored care recommendations, and personalized cost tracking tools. These features shift the traditional transactional approach to healthcare towards a more journey-based and holistic style of care.

UnitedHealth Group (UNH) is also advancing digital healthcare by leveraging its core competencies in clinical delivery, technology, and data analytics. The company has over a thousand AI applications in production across its insurance, health delivery, and pharmacy units. These applications include transcribing conversations from clinician visits, summarizing data, processing claims, and powering customer-facing chatbots.

CVS Health's stock has shown strong performance year-to-date, rising 46.8% against the industry's 4% fall. The company's forward 12-month price-to-sales ratio is 0.21, lower than the industry average of 0.39, and it carries a Value Score of A. Analyst estimates for the company's 2025 and 2026 earnings are bullish.

References:
[1] https://www.nasdaq.com/articles/cvs-advances-digital-efforts-simplify-healthcare-experience
[2] https://finance.yahoo.com/news/cvs-advances-digital-efforts-simplify-123000374.html
[3] https://www.theglobeandmail.com/investing/markets/stocks/UNH/pressreleases/34150796/cvs-advances-digital-efforts-to-simplify-healthcare-experience/