CVS Health

CVS was a pharmacy on thin margins until 2017. They closed the acquisition of Aetna, a health insurance company for $69 billion in 2018. A pharmacy buying an insurer seemed backwards, but CVS understood vertical integration. Now they owned insurers, pharmacies and clinics. A patient visited minute clinic, received treatment, got medication and claims paid automatically without friction. Insurers wanted to minimize payouts to pharmacies. Pharmacies wanted to maximize margins. Both fought over money from the same customer. CVS owned both sides. When an insurer paid a pharmacist, that money was transferred internally. The friction disappeared and profit consolidated.