“These two factors combine to drive clinics to maturity, achieving profitability within the first 3 years and unlocking annual adjusted EBITDA potential of approximately $7 million per clinic using Oak Street’s definition of adjusted EBITDA.”

In context

“et that proved to be the most strategically and financially compelling. Oak Street will operate as a payer-agnostic business within CVS Health, focused on improving outcomes and experiences for the Medicare population it serves. CVS Health has a strong and proven track record of helping its payer clients succeed, and we will continue to prioritize that success after this transaction. What we saw when we looked into Oak Street’s portfolio of clinics was a remarkably consistent path to clinic profitability. This trend was true across diverse geographies, populations and payers. As Oak Street drives strong patient experiences and engagement, their patient panels grow. And as Oak Street’s providers engage with those patients, they improve outcomes and increase patient contributions over time. These two factors combine to drive clinics to maturity, achieving profitability within the first 3 years and unlocking annual adjusted EBITDA potential of approximately $7 million per clinic using Oak Street’s definition of adjusted EBITDA. Within the 169 clinics Oak Street has today, we have high visibility into embedded adjusted EBITDA of over $1 billion. We also recognize the tremendous opportunity to scale Oak Street’s clinics to reach more seniors across the nation. At their current rate of expansion, we expect Oak Street to have over 300 clinics by 2026, at which point we project they will have more than $2 billion of embedded Oak Street adjusted EBITDA. Shifting to synergies. We envisioned five main opportunities to realize more than $500 million of value over time: one, accelerating Oak Street patient growth through CVS Health channels; two, improving Oak Street’s economics through integration with our broad portfolio of assets; three, improving the retention of our Aetna MA members through the improved outcomes and”