Exhale: New CVS leadership will not sell Aetna, Wall Street Journal reports.

A close call averted–for now. CVS installed a new president overnight, replacing Aetna veteran Karen Lynch as the head of the troubled giant healthcare company.

The company’s new leader, David Joyner, spent part of his successful career at Aetna before joining the complex and controversial world of pharmacy benefits management (PBM). Lynch had recently added running Aetna to her portfolio after the abrupt departure of Brian Kane after another disappointing earnings report.

CVS Health Corp.’s stock fell by 12% in the aftermath of the announcement of changes at the top of the company and guidance lowering expected earnings in anticipation of third quarter results to be released on November 6th.

Aetna has been a leader in creating and selling popular Medicare Advantage programs. Profits from the policies millions of older Americans enroll in each year have been targets of the Biden administration and elected officials. Efforts to control the cost of government subsidized healthcare will continue to highlight profits made by major health insurance companies providing Medicare Advantage.

Joyner and CVS board of directors chairman Roger Farah, who will serve as executive chair, told the Wall Street Journal the company will move forward intact. That decision will reassure nervous Aetna employees that the company will not be sold as its stock value continues to suffering a nearly yearlong decline.

Published October 18, 2024.