Walmart will leave the drugstore networks run by CVS Health's pharmacy benefit management unit because of a pricing dispute.
The dispute between the two pharmacy giants will affect employees with CVS-administered drug benefits and Medicaid beneficiaries with CVS drug coverage. Those health plans won't pay for prescriptions filled at Walmart pharmacies.
CVS Caremark, the PBM arm of CVS, said the split will not affect pharmacy networks in its Medicare plans and doesn't include Sam's Club stores, which are owned by Walmart.
Walmart was demanding higher reimbursements for its pharmacies, a rate that "would ultimately result in higher costs for our clients and consumers," CVS Caremark President Derica Rice said. "We simply could not agree to their recent demands for an increase in reimbursement."
Walmart said it resisted efforts by CVS to steer consumers to certain pharmacies to have their prescriptions filled, and it was committed to giving customers access to affordable healthcare, "but we don't want to give that value to the middle man," according to Bloomberg.
CVS asked Walmart to continue filling prescriptions as an in-network pharmacy through April 30. If Walmart doesn't agree with the terms, the split would occur in early February, according to The Wall Street Journal.
Read the full news release here.