Summary
- CVS has a plan to become a holistic one-stop-shop for healthcare financing and provision.
- Through a combination of benefits, pharmacy services, and basic care provision, CVS promises to make welcome improvements to the United States' flawed healthcare system.
- Of course, this assumes that fundamental healthcare reform legislation does not come along and wipe out 29% of CVS's total revenue.
- How seriously should CVS investors take the threat of a single-payer system?
- In lieu of a single-payer future, CVS offers fantastic potential returns going forward.
CVS Health Corp. (CVS) wants to become the future face of healthcare in America. Despite the sluggish pace of progress in the health/medical space, the company is rapidly evolving into a comprehensive "health care destination" that may reshape the way Americans pay for and receive care.
Management has a grip on most of the risks it faces as this newfound conglomerate (and other writers on Seeking Alpha have done a good job of explaining them), but there remains one big risk that is difficult to quantify: the looming threat of healthcare reform that would usher in a single-payer system.
CVS's planned evolution promises to provide consumers a convenient and affordable alternative for healthcare financing and provision, but only if true single-payer does not come about. How big of a threat to CVS is single-payer?
