CVS Health CEO Larry Merlo to be replaced by Karen Lynch
Larry Merlo will step down as CEO of CVS Health in February, when he will be replaced by Karen Lynch, Aetna’s current president.
Merlo will serve on CVS’ board and help with the leadership transition through May when he retires, capping his 10-year tenure as chief executive and 40 years at the company. On a third-quarter earnings call last week, Merlo highlighted some of the company’s achievements while he was CEO: growing CVS’ pharmacy benefit management business, expanding its retail footprint, establishing the MinuteClinic business and overseeing its “industry disrupting” acquisition of Aetna two years ago.
Lynch helped launch the Aetna Connected Plan, which offers certain MinuteClinic services at no cost; grow Medicare Advantage membership; and incorporate HealthHUBs into Aetna’s offerings, which focus on chronic care management.
CVS is on track to convert 40,000 Medicare Part D beneficiaries to Medicare Advantage members in 2020, Merlo said on the call, adding that he is confident CVS will be able to expand those conversions. CVS reported operating income of $3.3 billion on revenue of $67.1 billion in the third quarter, up from $2.9 billion in operating income on $64.8 billion of revenue for the prior-year period. Net income dipped from $1.5 billion to $1.2 billion over that span.
Merlo’s supplemental executive retirement plan was worth $40.3 million in 2019, as CVS tallied $256.8 billion in revenue.