CVS Health recently announced three programs that will enable employees to share in the tax savings created by the U.S. Tax Cuts and Jobs Act.
The Woonsocket, Rhode Island-based company will increase the starting wage rate for hourly employees to $11 an hour, effective in April. As part of this change, CVS Health also plans to adjust pay ranges and rates for many of its retail pharmacy technicians, front-of-the-store associates and other hourly retail employees later in the year to ensure a competitive compensation structure that supports its plans to evolve its retail stores into healthcare destinations.
CVS Health will not increase employee premiums for the 2018-19 plan year. While medical and prescription costs have increased 5 percent year over year, CVS Health will absorb the entire increase for the 100,000 employees who have elected to enroll in the company-sponsored health plan, it says.
The company also is creating a new paid parental leave program. Effective April 1, full-time employees who welcome a new child into their home can take up to four weeks away from work at 100 percent of their pay.
“As part of our ongoing commitment to the patients, customers and communities we serve, we said that we would invest our tax savings back into our business, and that’s exactly what we’re doing,” said Larry Merlo, CVS Health president and CEO. “Today, we’re building on the investments we’ve been making in our employees, in their wages, benefits and career development. It’s our employees who drive our performance, and we appreciate how hard they work every day to deliver on our purpose of helping people on their path to better health.”
CVS Health indicated that it anticipated spending the remaining tax benefits on investments in data analytics, care management solutions and store pilots to improve health outcomes and lower costs for patients, as well as on debt reduction related to its planned acquisition of Aetna.
“We are also making additional, significant, infrastructure investments that will allow us to accelerate our long-term growth objectives,” Merlo added.
CVS employs 240,000 employees across the country and has more than 9,800 retail locations.