The news: CVS Health launched a first-of-its-kind insurer-backed virtual primary care solution nationwide, Aetna Virtual Primary Care, for self-funded employers.

• The service uses Teladoc Health’s physician-led care team model and Aetna’s provider network of over 1.2 million healthcare providers.

Here are some of Aetna Virtual Primary Care’s key offerings:

• $0 copays for virtual primary care visits and select in-person services at CVS MinuteClinic and HealthHUB locations.
• In-person visits with in-network providers with no referral requirements.
• Access to Aetna’s existing virtual care offerings (such as mental health counseling, dermatology services, and 24/7 urgent care).
• Members get continuous relationships with a virtual care physician. This is notable, considering most telehealth solutions on the market don’t offer a consistent patient-provider relationship, and instead force patients to connect with a new doctor for each virtual visit. CVS-Aetna’s feature more closely mirrors an in-person doctor-patient relationship, which can motivate more consumers to try it.

How this shakes up the virtual primary care space: CVS is uniquely positioned to take on the primary care space since it’s equipped with both its retail footprint and health insurance business via Aetna.

Since Aetna Virtual Primary Care the program will be available via employers, CVS can lean on Aetna’s existing employer customer base to sell and distribute its new service. Aetna already covers around 40 million members, so its new virtual primary care program has a platform it can quickly grow from. Not to mention, CVS has conveniently accessible in-person locations: It has over 1,100 MinuteClinic locations and plans to have 650 HealthHUB locations by the end of this year.

• This directly threatens players like Oak Street Health, Walgreens-partnered Village MD, and Doctor on Demand, who have been gradually building out both brick-and-mortar and virtual primary care services since the pandemic thrusted digital health to the forefront of primary care.

What’s next? Back in April, CVS launched its digital health ventures arm—now that it's integrating a new virtual primary care service into its business, it has a direct pipeline to pilot and launch the latest digital health innovations. This could be part of a larger strategy of carving out its place as a digital health leader.

Go deeper: We dive into how retail health clinics have used the pandemic to turbocharge their growth in our recently published analyst note, check it out here.