MedPartners

CVS Caremark (formerly Caremark Rx) is the pharmacy benefit management subsidiary of CVS Health, headquartered in Woonsocket, Rhode Island.

Company history

Early years

CVS Caremark was founded in 1993 as MedPartners, Inc. in Birmingham, Alabama by several local businessmen as a physician practice management (PPM) company. HealthSouth, New Enterprise Associates, and Richard M. Scrushy stepped in to provide the company with early financial backing. Larry House, an executive at HealthSouth, was brought on to serve as the company's first CEO.

MedPartners went public in February 1995 and began buying up other PPM business around the country. In August 1995, MedPartners announced the acquisition of Mullikin Medical Enterprises, a PPM company based in California. In December 1995, MedPartners acquired Pacific Physicians Services, a PPM company based in Redlands, California.

The company continued to grow by acquiring physician practice groups, including the Kelsey-Seybold Clinic in Houston, Texas, the Summit Medical Group in Summit, New Jersey, and the Ross–Loos Medical Group in Los Angeles, California. By 1996, MedPartners was the largest PPM company in the United States and became a Fortune 500 company the following year.

Caremark International

Caremark International was founded in 1979 in Newport Beach, California as a provider of specialized medical services and products to chronically ill patients at home. It also operated the second largest mail-order pharmacy benefit management (PBM) business in country. Baxter International, then known as Baxter Travenol, acquired Caremark in 1987. Baxter spun off Caremark in 1992 and based it in Northbrook, Illinois, near Baxter's Deerfield headquarters. Included in the spin-off was the at-home intravenous drug business, the mail-order pharmacy business, the physician practice management business, and Baxter's chain of physical therapy and sports medicine clinics. Caremark sold its at-home intravenous drug business to Coram in February 1995 followed by its physical therapy and sports medicine business to HealthSouth later that year in October. MedPartners announced it would acquire Caremark for $2.5 billion in May 1996.

Canceled merger and PPM exit

MedPartners announced in October 1997 it would be acquired by PhyCor, Inc., a much smaller PPM competitor based in Nashville, Tennessee, for $6.8 billion. MedPartners and PhyCor called off the merger in January 1998 after problems were discovered during due diligence with MedPartners' western PPM operations. Larry House resigned as chairman and CEO several weeks later. Richard Scrushy, a MedPartners' board member, stepped in as interim chairman and CEO while continuing to serve as chairman and CEO of HealthSouth. In March, Edwin "Mac" Crawford was selected by the board of directors as MedPartners' new CEO. Scrushy retained the chairman role until December 1998 when he relinquished it to Crawford.

MedPartners board of directors conducted a review of its businesses after the failed merger and decided to sell the clinics that made up the PPM business and focus on growing the Caremark PBM business, which accounted for $2.3 billion of MedPartners $6.3 billion total revenue for 1997. MedPartners also sold its hospital-based physician-management unit, Team Health, to Madison Dearborn Partners and Team Health's management team in 1999.

In 2000, after completing the sales of its clinics tied to the physician management business, MedPartners changed its name to Caremark Rx, Inc. to reflect the name of its only business unit.

Caremark Rx

In 2003, it merged with AdvancePCS. That same year, Caremark moved its headquarters from Birmingham, Alabama, to Nashville, Tennessee. Following its merger with AdvancePCS, the company continued to operate a mail-order pharmacy operation in Birmingham that employed 500 people until 2010.

In March 2007, Caremark merged with CVS Corporation to create CVS Caremark. The Nashville office was closed following the merger.

In 2014, the corporate name for CVS Caremark became CVS Health, with CVS Caremark becoming a subsidiary.

In January 2019, Walmart announced that it would no longer use CVS Caremark as its pharmacy benefit manager.

In February 2020, Alan Lotvin was appointed president of CVS Caremark.

References

External links

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{{CVS Health

1993 establishments in Alabama
2007 mergers and acquisitions
American companies established in 1993
American corporate subsidiaries
Companies based in Providence County, Rhode Island
Corporate spin-offs
Caremark
Health care companies based in Rhode Island
Health care companies established in 1993
Pharmacy benefit management companies based in the United States
Woonsocket, Rhode Island