Pharmacy healthcare services provider CVS Health Corp. CVS recently entered into a strategic partnership with the U.S. Department of Health and Human Services (HHS) to make available significant information about preventive health services on its websites, MinuteClinic.com and CVS.com/myhealthfinder.
Notably, CVS Health is the first national partner to be associated with the U.S. Department of HHS to promote the technology-based health care tools developed within the department.
Under the terms of this agreement, CVS Health and the Department of HHS will jointly endorse the myhealthfinder tool online. The tool allows patients access to expert recommendations on preventive healthcare services from government-recognized clinicians, customized as per their age and gender.
Recent advancements in medical equipment and services have helped enhance clinical outcomes. This has inevitably resulted in a gradual shift in focus from curative to preventive healthcare.
According to the Transparency Market Research report, the global preventive healthcare technologies and services market is estimated to touch $144.8 billion in 2020, with a CAGR of growth of 9.7% from 2014 to 2020. In this scenario, we view CVS Health’s collaboration with the government as a favorable one that will help it expand its customer base and thus capture increased market share, going forward.
Per management, the government is leaving no stone unturned to build up awareness on its preventive services. The easy availability of these services at MinuteClinic and CVS/pharmacy locations will encourage more healthcare providers to recommend them online. Moreover, the fact that these are covered by most insurance companies under the norms of the Affordable Care Act makes it all the more convenient.
We note that, as per a report issued by the Department of HHS, about 137 million U.S. citizens have private insurance coverage of preventive services and do not require to pay a co-pay, co-insurance, or deductible. This, we believe, will work significantly in favor of CVS Health, while also propelling the popularity of the preventive health services among the masses.
Currently, CVS Health carries a Zacks Rank #3 (Hold). Some better-ranked medical stocks are Actelion Ltd. ALIOF, Gilead Sciences Inc. GILD and Illumina Inc. ILMN. All the three stocks sport a Zacks Rank #1 (Strong Buy).
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