CVS Health Corp.’s layoffs to hit CT for a second consecutive year. Nearly 100 local jobs to be cut. - Insurance News | InsuranceNewsNet

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October 7, 2024 Newswires
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CVS Health Corp.’s layoffs to hit CT for a second consecutive year. Nearly 100 local jobs to be cut.

Kenneth R. Gosselin, Hartford CourantHartford Courant

CVS Health Corp. said Monday that it will cut nearly 100 corporate jobs at the Hartford-based headquarters of its Aetna health insurance business, plus another 323 remote jobs that are based in other states but report directly to Hartford.

In a filing with the state labor department, CVS said the 93 layoffs in Hartford, which will be permanent, will take place over a two-week period, between Dec. 8 and Dec. 21. The job cuts are the latest blow to the Aetna employee base in Hartford, coming on top of 336 layoffs in the city last year.

CVS did not immediately respond to an inquiry seeking the total employment at the sprawling Aetna headquarters on Farmington Avenue in Hartford.

Together, the jobs in Hartford and those directly related to it add up to 416.

The layoffs are part of CVS’ plans, announced last week, for slashing 2,900 corporate jobs nationwide, as it seeks to cut $2 billion in expenses over the next several years while it struggles with rising medical costs industrywide. CVS cut 5,000 jobs nationally in 2023.

“All employees who will be terminated as a result of this action have been notified of their specific separation dates and that their separation from employment will be permanent,” according to the filing with labor department.

The jobs range from managers and analysts to underwriters and administrative assistants, according to the 14-page filing.

Hartford Mayor Arunan Arulampalam “has personally kept in touch with representatives from CVS and has expressed the importance of keeping jobs in Hartford and preserving opportunities for economic growth in our capital city,” said Cristian Corza-Godinez, a spokesman for the mayor.

The latest round of layoffs at Woonsocket, R.I.-based CVS come as reports circulated that CVS is considering a break-up of the company, potentially separating its pharmacy and insurance businesses. Such a move would unwind CVS’s landmark, $69 billion acquisition of Aetna, founded in Hartford in 1853.

When CVS acquired Aetna, it agreed to keep the health insurer headquartered in Hartford for at least a decade, a milestone that will be marked in 2028. A companion agreement with Connecticut insurance regulators included a promise to keep employment at Aetna and its subsidiaries at 5,300 for at least four years. The four years ended in 2022.

CVS said it counts remote workers in the Hartford tally because they are “assigned” to the city for purpose of layoff notices required by the government.

CVS has grown into a health care giant with its massive chain of pharmacies, health insurance, Medicare-focused physician care in neighborhood clinics and a pharmacy benefit manager. PBMs manage drug plans and influence medication prices and distribution.

But in August, CVS cut its full-year outlook for profits and launched a new plan to cut the $2 billion in costs, with rising costs at Aetna’s Medicare business a particular concern. On Monday, CVS reiterated the reasons behind the cost cutting, as the health care industry faces “disruption, regulatory pressures and evolving consumer needs and expectations.”

Lowering expenses will help the health care giant to invest in new technologies that will help CVS remain competitive in the marketplace, CVS said.

CVS said the 2,900 layoffs nationally represent less than 1 percent of the 300,000 that the health care giant employs across the country. CVS said last week it prioritized where it could cut costs, including closing open job postings.

Kenneth R. Gosselin can be reached at [email protected].

©2024 Hartford Courant. Visit courant.com. Distributed by Tribune Content Agency, LLC.

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