CVS Health, the nation's largest pharmacy chain, will streamline how it prices drugs by moving to a cost-plus model during the first half of 2024. The move comes as the company launches a rebrand of its health-care delivery services and makes other strategic moves in an attempt to improve company performance.

Under the pricing plan, pharmacy benefit managers and other payers will reimburse the company's roughly 9,500 retail pharmacies based on the amount that CVS paid for the drugs, plus a limited markup and flat fee to cover services involved in handling and dispensing prescriptions. Today, pharmacies generally are paid using complex measures that aren't directly based on what they spent to purchase specific drugs. The change will have a mixed impact on employers and insurers paying for prescriptions, CVS executives said.

CVS is making the move as it seeks to stabilize its retail pharmacy business, which has long struggled with stagnating margins on its core function of dispensing prescriptions. The company also is responding to criticism from lawmakers, employers and patients about the complexity and lack of transparency around how drugs are bought and sold. Members of Congress and some employer groups have argued that the current setup is flawed and secretive.