Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Schedule of Cash, Cash Equivalents, and Restricted Cash

The following represents a reconciliation of cash and cash equivalents in the unaudited condensed consolidated balance sheets to total cash, cash equivalents and restricted cash in the unaudited condensed consolidated statements of cash flows:

In millions	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	5,193	$	4,059
Restricted cash (included in other current assets)	6		6
Restricted cash (included in other assets)	270		230
Total cash, cash equivalents and restricted cash in the statements of cash flows	$	5,469	$	4,295

Accounts Receivable, Net

Accounts receivable, net is composed of the following:

In millions	September 30, 2019		December 31, 2018
Trade receivables	$	6,413	$	6,497
Vendor and manufacturer receivables	9,029		7,315
Premium receivables	2,340		2,259
Other receivables	2,007		1,560
Total accounts receivable, net	$	19,789	$	17,631

Disaggregation of Revenue

The following tables disaggregate the Company’s revenue by major source in each segment for the three and nine months ended September 30, 2019 and 2018:

In millions	Pharmacy Services		Retail/ LTC		Health Care Benefits		Corporate/ Other		Intersegment Eliminations			Consolidated Totals
Three Months Ended September 30, 2019
Major goods/services lines:
Pharmacy	$	35,872	$	16,687	$	—	$	—	$	(10,007	)	$	42,552
Front Store	—		4,614		—		—		—			4,614
Premiums	—		—		15,507		32		—			15,539
Net investment income	—		—		146		117		—			263
Other	146		165		1,528		3		—			1,842
Total	$	36,018	$	21,466	$	17,181	$	152	$	(10,007	)	$	64,810
Pharmacy Services distribution channel:
Pharmacy network (1)	$	22,469
Mail choice (2)	13,403
Other	146
Total	$	36,018
Three Months Ended September 30, 2018
Major goods/services lines:
Pharmacy	$	33,733	$	16,123	$	—	$	—	$	(8,088	)	$	41,768
Front Store	—		4,557		—		—		—			4,557
Premiums	—		—		627		—		—			627
Net investment income	—		—		4		217		—			221
Other	131		176		10		—		—			317
Total	$	33,864	$	20,856	$	641	$	217	$	(8,088	)	$	47,490
Pharmacy Services distribution channel:
Pharmacy network (1)	$	21,921
Mail choice (2)	11,812
Other	131
Total	$	33,864

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(1) Pharmacy Services pharmacy network is defined as claims filled at retail and specialty retail pharmacies, including the Company’s retail pharmacies and LTC pharmacies, but excluding Maintenance Choice^® activity, which is included within the mail choice category.

(2) Pharmacy Services mail choice is defined as claims filled at a Pharmacy Services mail facility, which includes specialty mail claims inclusive of Specialty Connect^® claims picked up at a CVS Pharmacy retail store, as well as prescriptions filled at the Company’s retail pharmacies under the Maintenance Choice program, which permits eligible client plan members to fill their maintenance prescriptions through mail order delivery or at a CVS Pharmacy retail store for the same price as mail order.

In millions	Pharmacy Services		Retail/ LTC		Health Care Benefits		Corporate/ Other		Intersegment Eliminations			Consolidated Totals
Nine Months Ended September 30, 2019
Major goods/services lines:
Pharmacy	$	103,983	$	49,197	$	—	$	—	$	(31,436	)	$	121,744
Front Store	—		14,288		—		—		—			14,288
Premiums	—		—		47,543		69		—			47,612
Net investment income	—		—		458		347		—			805
Other	435		543		4,453		7		—			5,438
Total	$	104,418	$	64,028	$	52,454	$	423	$	(31,436	)	$	189,887
Pharmacy Services distribution channel:
Pharmacy network (1)	$	66,071
Mail choice (2)	37,912
Other	435
Total	$	104,418
Nine Months Ended September 30, 2018
Major goods/services lines:
Pharmacy	$	99,432	$	47,428	$	—	$	—	$	(24,840	)	$	122,020
Front Store	—		13,990		—		—		—			13,990
Premiums	—		—		2,684		—		—			2,684
Net investment income	—		—		10		475		—			485
Other	405		542		29		—		—			976
Total	$	99,837	$	61,960	$	2,723	$	475	$	(24,840	)	$	140,155
Pharmacy Services distribution channel:
Pharmacy network (1)	$	64,625
Mail choice (2)	34,807
Other	405
Total	$	99,837

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(1) Pharmacy Services pharmacy network is defined as claims filled at retail and specialty retail pharmacies, including the Company’s retail pharmacies and LTC pharmacies, but excluding Maintenance Choice^® activity, which is included within the mail choice category.

(2)

Pharmacy Services mail choice is defined as claims filled at a Pharmacy Services mail facility, which includes specialty mail claims inclusive of Specialty Connect^® claims picked up at a CVS Pharmacy retail store, as well as prescriptions filled at the Company’s retail pharmacies under the Maintenance Choice program, which permits eligible client plan members to fill their maintenance prescriptions through mail order delivery or at a CVS Pharmacy retail store for the same price as mail order.

Contracts With Customers, Assets and Liabilities

The following table provides information about receivables and contract liabilities from contracts with customers:

In millions	September 30, 2019		December 31, 2018
Trade receivables (included in accounts receivable, net)	$	6,413	$	6,497
Contract liabilities (included in accrued expenses)	72		67

During the nine months ended September 30, 2019, the contract liabilities balance includes increases related to customers’ earnings in ExtraBucks Rewards or issuances of Company gift cards and decreases for revenues recognized during the period as a result of the redemption of ExtraBucks Rewards or Company gift cards and breakage of Company gift cards. Below is a summary of such changes:

In millions
Balance at December 31, 2018	$	67
Loyalty program earnings and gift card issuances	269
Redemption and breakage	(264		)
Balance at September 30, 2019	$	72

Impact of New Lease Standard on Balance Sheet Line Items

As a result of applying the new lease accounting standard using a modified retrospective method, the following adjustments were made to accounts on the condensed consolidated balance sheet as of January 1, 2019:

	Impact of Change in Accounting Policy
In millions	As Reported December 31, 2018		Adjustments			As Adjusted January 1, 2019
Condensed Consolidated Balance Sheets:
Other current assets	$	4,581	$	(48	)	$	4,533
Total current assets	45,243		(48		)	45,195
Property and equipment, net	11,349		11			11,360
Operating lease right-of-use assets	—		20,987			20,987
Intangible assets, net	36,524		(217		)	36,307
Other assets	5,046		(521		)	4,525
Total assets	196,456		20,212			216,668
Accrued expenses	10,711		(52		)	10,659
Current portion of operating lease liabilities	—		1,803			1,803
Current portion of long-term debt	1,265		2			1,267
Total current liabilities	44,009		1,753			45,762
Long-term operating lease liabilities	—		18,832			18,832
Long-term debt	71,444		(96		)	71,348
Deferred income taxes	7,677		63			7,740
Other long-term liabilities	2,780		(518		)	2,262
Total liabilities	137,913		20,034			157,947
Retained earnings	40,911		178			41,089
Total CVS Health shareholders’ equity	58,225		178			58,403
Total shareholders’ equity	58,543		178			58,721