CNBNews

The former CVS Pharmacy in the Fairview section of Camden City is being renovated into an Oak Street Health medical facility  (photo credit CNBNews)

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CAMDEN CITY, NJ (MAY 23, 2025)(CNBNews)—Oak Street Health, a network of primary care centers specializing in value-based care for adults on Medicare, is moving into the former CVS Pharmacy in the Fairview section of Camden City. 

According to an artificial intelligence (AI) search, Oak Street Health has adopted technology to enhance patient care and operational efficiency, particularly through the use of machine learning models. 

Here's how Oak Street Health utilizes AI:

• Risk Stratification: Oak Street Health successfully implemented a machine learning tool that identifies high-risk patients more effectively than previous methods. This enables them to allocate resources effectively and focus on preventive care, managing chronic conditions, and coordinating care for patients who need it most.
• Predicting Outcomes: They utilize AI models to forecast the risk of acute inpatient admissions, future medical expenses, and mortality, enabling them to address potential health issues proactively.
• Disease Detection: Oak Street Health employs AI-based algorithms to detect chronic conditions like congestive heart failure, COPD, and diabetes by analyzing health data from medical records.
• Canopy Platform: They have developed their own in-house medical record software called Canopy, which leverages AI and machine learning to refine predictive models and prescriptive algorithms. Canopy helps inform care delivery, reduce hospital admissions and readmissions, control medical costs, and improve patient retention.
• Care Coordination: Canopy also hosts internal applications that help staff manage patient care, including post-hospitalization follow-up and discharge planning. This contributes to reductions in hospital readmissions and emergency room visits.
• Addressing Physician Burnout: Oak Street Health recognizes the potential of AI, specifically ambient AI powered by large language models, to reduce administrative burdens on clinicians and improve their well-being.
• Potential for Generative AI: They are exploring the use of generative AI to assist with case summarization and history taking, enabling clinical teams to focus more on direct patient interaction. 

Impact of CVS Health Acquisition:

CVS Health acquired Oak Street Health in May 2023. This acquisition expanded CVS Health's value-based primary care platform, positioning it to leverage Oak Street Health's AI capabilities further, including the Canopy platform. The integration with CVS Health's extensive network and resources is expected to accelerate the expansion of Oak Street Health's clinics and enhance their ability to provide integrated healthcare services. 

OAK STREET HEALTH DISCONTINUES PROGRAM

There have been recent allegations of kickbacks related to Oak Street Health's patient recruitment practices prior to the CVS acquisition, resulting in a $60 million settlement with the Department of Justice. CVS Health has stated that it cooperated with the DOJ and discontinued the program in question. 

According to a Department of Justice media release on September 18, 2024, the Department of Justice (DOJ) released the following statement regarding Oak Street Health:

Oak Street Health,  headquartered in Chicago and a wholly-owned subsidiary of CVS Health since 2023, has agreed to pay $60 million to resolve allegations that it violated the False Claims Act by paying kickbacks to third-party insurance agents in exchange for recruiting seniors to Oak Street Health’s primary care clinics.

 

The Anti-Kickback Statute prohibits anyone from offering or paying, directly or indirectly, any remuneration, which includes money or any other thing of value, to induce referrals of patients or to provide recommendations of items or services covered by Medicare, Medicaid, and other federally funded programs. Under the Medicare Advantage (MA) Program, also known as Part C, Medicare beneficiaries have the option to obtain their health care through privately operated insurance plans known as MA plans. Some MA Plans contract with health care providers, including Oak Street Health, to provide their plan members with primary care services.

 

The United States alleged that, in 2020, Oak Street Health developed a program to increase patient membership called the Client Awareness Program. Under the Program, third-party insurance agents contacted seniors eligible for or enrolled in Medicare Advantage and delivered marketing messages designed to generate interest in Oak Street Health. Agents then referred interested seniors to an Oak Street Health employee via a three-way phone call, otherwise known as a “warm transfer,” and/or an electronic submission. In exchange, Oak Street Health paid agents typically $200 per beneficiary referred or recommended. These payments incentivized agents to base their referrals and recommendations on the financial motivations of Oak Street Health rather than the best interests of seniors. The settlement resolves allegations that, from September 2020 through December 2022, Oak Street Health knowingly submitted, and caused to be submitted, false claims to Medicare arising from kickbacks to agents that violated the Anti-Kickback Statute.

The claims resolved by the settlement are allegations only. There has been no determination of liability.

Source (Department of Justice)

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