DEF 14A of CVS HEALTH Corp, Apr 5, 2024

DEF 14A of CVS HEALTH Corp

Filed Apr 5, 2024 · FY20230001308179-24-000463

Open on EDGAR

  1. Table of Contents

    | 93 | CEO Pay Ratio | | | 94 | Pay Versus Performance | | | 98 | Management Proposal | | | 98 | | Item 4: Proposal to Amend the Company’s 2017 Incentive Compensation Plan to Increase the Number of Shares Authorized to Be Issued Under the Plan | | 108 | Stockholder Proposals | | | 108 | | Item 5: Stockholder Proposal Requesting an Independent, Third Party Worker Rights Assessment and Report | | 111 | | Item 6: Stockholder Proposal to Prohibit the Re-nomination of Any Director Who Fails to Receive a Majority Vote | | 114 | | Item 7: Stockholder Proposal for Stockholder Right to Vote on “Excessive” Golden Parachutes | | 117 | | Item 8: Stockholder Proposal Requesting a Policy Requiring Our Directors to Disclose Their Expected Allocation of Hours Among All Formal Commitments | | 120 | Ownership of and Trading in Our Stock | | | 120 | Executive Officer and Director Stock Ownership Requirements | | | 121 | Share Ownership of Directors and Certain Executive Officers | | | 122 | Share Ownership of Principal Stockholders | | | 123 | Other Information | | | 123 | Information About the Annual Meeting and Voting | | | 126 | Stockholder Proposals and Other Business for Our Annual Meeting in 2025 | | | 127 | Other Matters | | | A-1 | Annex A – Reconciliation of Certain Amounts to the Most Directly Comparable GAAP Measure | | | B-1 | Annex B – 2017 Incentive Compensation Plan of CVS Health Corporation, as Proposed to be Amended | |

  2. The CVS Health Board

    The CVS Health Board Edward J. Ludwig, an independent member of the Board of Directors (the “Board”), will not be standing for re-election and is retiring from the Board at the 2024 Annual Meeting after an accomplished 30-plus year career in the field of medical technology. Upon the retirement of Mr. Ludwig, the size of the Board will be reduced to 12 directors. You are asked to vote on the election of the following 12 nominees to serve on the Board of CVS Health Corporation (“CVS Health” or the “Company”). All directors are elected by a majority of votes cast, and all presently serve on the Board. The information below reflects the current leadership and expected membership of each of the Board’s committees after the Annual Meeting.

  3. The CVS Health Board

    | | | Director Since | Independent | Other Public Company Boards | Committees | | | | | | | Name | | | | A | MP&D | N&CG | HS&T | E | | | Fernando Aguirre, 66 Former Chairman, President and CEO of Chiquita Brands International, Inc. | 2018 | YES | 2 | | | | | | | | Jeffrey R. Balser, M.D., Ph.D., 62 President and Chief Executive Officer of Vanderbilt University Medical Center | 2022 | YES | None | | | | | | | | C. David Brown II, 72 Partner and Former Member of Executive Committee of Nelson Mullins Riley & Scarborough LLP | 2007 | YES | None | | | | | | | | Alecia A. DeCoudreaux, 69 President Emerita of Mills College at Northeastern University, and Former Executive at Eli Lilly and Company | 2015 | YES | 1 | | | | | | | | Nancy-Ann M. DeParle, 67 Managing Partner and Co-Founder of Consonance Capital Partners, LLC and Former Director of White House Office of Health Reform | 2013 | YES | 1 | | | | | | | | Roger N. Farah, 71 Independent Chair of the Board of CVS Health Corporation; Former Chairman of the Board of Tiffany & Co. and Former Executive at Tory Burch and Ralph Lauren | 2018 | YES | 1 | | | | | | | | Anne M. Finucane, 71 Chair of the Board of Rubicon Carbon and Former Vice Chairman of Bank of America Corporation | 2011 | YES | 1 | | | | | | | | J. Scott Kirby, 56 CEO and a Member of the Board of Directors of United Airlines Holdings, Inc. | 2023 | YES | 1 | | | | | | | | Karen S. Lynch, 61 President and CEO of CVS Health Corporation | 2021 | NO | None | | | | | | | | Michael F. Mahoney, 59 Chairman of the Board, President and CEO of Boston Scientific Corporation | 2023 | YES | 1 | | | | | | | | Jean-Pierre Millon, 73 Former President and CEO of PCS Health Systems, Inc. | 2007 | YES | None | | | | | | | | Mary L. Schapiro, 68 Vice Chair of Global Public Policy and Special Advisor to the Chairman of Bloomberg L.P. and Former Chairman of the U.S. Securities and Exchange Commission | 2017 | YES | 1 | | | | | |

  4. The CVS Health Board

    | Key | | | | | | Member | A Audit | N&CG | Nominating and Corporate Governance | E Executive | | Committee Chair | MP&D Management Planning and Development | HS&T | Health Services and Technology | |

  5. Director Nominee Expertise, Skills and Experience

    Director Nominee Expertise, Skills and Experience Our director nominees possess relevant experience, skills and qualifications that allow the Board to effectively oversee the Company’s strategy and management. The Board has identified key skills, qualifications and experience that are important to the Board as a whole in light of our current business strategy and expected needs. Our director nominees have developed competencies in these skills through education, direct experience and oversight responsibilities. While many of our nominees have experience across most or all of these important skills and qualifications, the following graphic identifies the five most relevant for each nominee (in addition to Senior Leadership, which all of them possess). See page 13 for an individual skills matrix, along with details as to how these skills and expertise link to the Company’s strategy.

  6. The Director Nominees

    The Director Nominees

  7. BOARD SKILLS AND DIVERSITY MATRIX

    BOARD SKILLS AND DIVERSITY MATRIX We believe that our directors possess deep industry knowledge and expertise, are committed to representing the long-term interests of our stockholders and have the highest personal and professional ethics. Our Board is composed of directors with diverse perspectives and professional and personal experiences, which we believe is critical achieving our strategic goals. The following matrix displays the five primary attributes that the Board and the nominee considered to be most relevant to each of our director nominees. This matrix is not intended to be an exhaustive list of their skills, attributes or areas of principal contributions to the Board, and each director possesses skills in addition to those presented in this matrix. More information about each director nominee can be found in the section entitled “Biographies of our Incumbent Board Nominees.”

  8. BOARD SKILLS AND DIVERSITY MATRIX

    | Skills & Experience and How They Link to the Company’s Strategy | | | | | | | | | | | | | | | | Business Development and Corporate Transactions Provide insight to advance growth agenda of our strategic initiatives | | | | | | | | | | | | | | | Business Operations Provide guidance on the Company’s operations to help us to optimize our business strategy | | | | | | | | | | | | | | | Corporate Governance and Sustainability Help our Board fulfill its environmental, social and governance oversight function effectively | | | | | | | | | | | | | | | Finance Are particularly well-suited to overseeing the quality and integrity of our Company’s financial statements | | | | | | | | | | | | | | | Health Care and Health Services Possess deep knowledge of the business challenges and opportunities facing our Company in the health care industry | | | | | | | | | | | | | | | Public Policy and Government Affairs Offer insight into the regulatory environment of the many jurisdictions in which we operate, their legislative and administrative priorities, and the potential implications for our business | | | | | | | | | | | | | | | Regulated Industries Provide a valuable perspective on how an extensive regulatory framework intersects with strategic and operational planning, including outside the health care industry | | | | | | | | | | | | | | | Risk Management Are particularly adept at identifying and assessing the varied risks facing our Company, including the legal, regulatory and political environment and provide oversight of compliance standards | | | | | | | | | | | | | | | Senior Leadership Have experience overseeing senior leadership, finance, marketing and execution of business strategy from a management, board or governance perspective | | | | | | | | | | | | | | | Technology and Innovation Contribute expertise regarding product innovation and evolving customer, member and client expectations | | | | | | | | | | | | |

  9. BOARD SKILLS AND DIVERSITY MATRIX

    | Diversity/Background/Attributes | | | | | | | | | | | | | | | | Independent | | | | | | | | | | | | | | | Tenure | 11/18 | 9/22 | 3/07 | 3/15 | 9/13 | 11/18 | 1/11 | 10/23 | 2/21 | 11/23 | 3/07 | 5/17 | | | Age | 66 | 62 | 72 | 69 | 67 | 71 | 71 | 56 | 61 | 59 | 73 | 68 | | | Gender Identity | M | M | M | F | F | M | F | M | F | M | M | F | | | Black or African American | | | | | | | | | | | | | | | Eurasian | | | | | | | | | | | | | | | Hispanic/Latino | | | | | | | | | | | | | | | White | | | | | | | | | | | | | | | Born Outside the United States | | | | | | | | | | | | |

  10. Biographies of our Incumbent Board Nominees

    Biographies of our Incumbent Board Nominees

  11. Biographies of our Incumbent Board Nominees

    | | Fernando Aguirre, 66 | Independent Director | | | Former Chairman, President and CEO of Chiquita Brands International, Inc. Director since: November 2018 Race/Ethnicity and Gender: White, Hispanic/Latino Male | Education: B.S., Southern Illinois University, Edwardsville CVS Health Board Committees: Audit (Chair); Management, Planning and Development; Executive (through the Annual Meeting) Other Public Boards: Barry Callebaut AG; Synchrony Financial |

  12. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Aguirre is the former Chairman, President and Chief Executive Officer of Chiquita Brands International, Inc. (“Chiquita”), a global distributor of consumer products, having served as Chiquita’s President and Chief Executive Officer from January 2004 to October 2012 and its Chairman from May 2004 to October 2012. Prior to joining Chiquita, Mr. Aguirre worked for more than 23 years in brand management, general management and turnarounds at The Procter & Gamble Company (“P&G”), a manufacturer and distributor of consumer products. Mr. Aguirre began his P&G career in 1980, serving in various capacities including President and General Manager of P&G Brazil, President of P&G Mexico, Vice President of P&G’s global snacks and U.S. food products, and President of global feminine care. Mr. Aguirre was a member of the board of directors of Aetna from 2011 until the closing of the Aetna Transaction, when he became a director of CVS Health. Mr. Aguirre also serves as a director of Barry Callebaut AG, a manufacturer of high-quality chocolate and cocoa products, and is the chair of its nominating and compensation committee, and as a director of Synchrony Financial, a consumer financial services company. He also serves as chair of Synchrony’s nominating and corporate governance committee. Skills and Qualifications of Particular Relevance to CVS Health Mr. Aguirre brings to the Board extensive consumer products, global business and executive leadership experience. As a former Chairman and CEO of a large public company that produces and distributes consumer products worldwide, he has significant brand management and international experience that is valuable to the Board’s strategic and operational understanding of global markets. Mr. Aguirre’s experience and service on other large public company boards, where he has served as chair of various committees, positions him well as the Chair of our Audit Committee and member of the Management Planning and Development Committee. | | | Business Operations | | | | Corporate Governance and Sustainability | | | | Finance | | | | Health Care and Health Services | | | | Regulated Industries | |

  13. Biographies of our Incumbent Board Nominees

    | | Jeffrey R. Balser, M.D., Ph.D., 62 | Independent Director | | | President and Chief Executive Officer of Vanderbilt University Medical Center and Dean of Vanderbilt University School of Medicine Director since: September 2022 Race/Ethnicity and Gender: White Male | Education: B.S., Tulane University; M.D. and Ph.D., Vanderbilt University CVS Health Board Committees: Health Services and Technology; Audit; Executive (following the Annual Meeting) Other Public Boards: None |

  14. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Dr. Balser has served as the chief executive of Vanderbilt University Medical Center (“VUMC”) since 2009 and has been President and Chief Executive Officer since 2016, when VUMC became an independent health care company. He has also served as the Dean of the Vanderbilt University School of Medicine since 2008. Dr. Balser is a member of the National Academy of Medicine and serves on its governing council. He previously served on the board of Varian Medical Systems, Inc., an oncology treatment device and software maker that was publicly traded, from October 2018 until Varian was acquired by Siemens Healthineers AG in April 2021. Skills and Qualifications of Particular Relevance to CVS Health Dr. Balser’s business experience includes large regional quaternary health delivery system leadership, human capital management, senior business management experience including a number of community hospital and medical practice acquisitions, overall risk management expertise through oversight of VUMC’s quality, compliance and corporate integrity activities, and financial expertise through management of its financial statements and VUMC’s separation from Vanderbilt University. His experience as a physician scientist includes leading NIH-funded research in various areas of pharmacogenomics and spearheading growth in personalized medicine at VUMC from research concepts to bedside care, integrating advances in informatics, discovery science, and precision genomics. Under his leadership, VUMC has become an academic leader in health information technology. His education and experience as an M.D. with a Ph.D. in pharmacology are considered by the Board to be tremendous assets as the Company further expands into health care delivery services. The Board believes that Dr. Balser’s experience adds knowledge and leadership depth and that he brings great value as a member of the Health Services and Technology Committee. | | | Finance | | | | Health Care and Health Services | | | | Regulated Industries | | | | Risk Management | | | | Technology and Innovation | |

  15. Biographies of our Incumbent Board Nominees

    | | C. David Brown II, 72 | Independent Director | | | Partner and Former Member of the Executive Committee of Nelson Mullins Riley & Scarborough LLP Director since: March 2007 Race/Ethnicity and Gender: White Male | Education: B.S.B.A., University of Florida; J.D., University of Florida College of Law CVS Health Board Committees: Management Planning and Development (Chair); Nominating and Corporate Governance; Executive (through the Annual Meeting) Other Public Boards: None |

  16. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Brown has been a partner of Nelson Mullins Riley & Scarborough LLP (“Nelson Mullins”), a national law firm, since the August 2018 merger of Nelson Mullins and the Florida-based Broad and Cassel, of which Mr. Brown was Chairman from March 2000 through the time of the merger. He was also a member of the executive committee of Nelson Mullins until he rotated off the committee in December 2021. He served as the lead director of Rayonier Advanced Materials Inc., a leading specialty cellulose production company, until his retirement from that board in May 2020. Mr. Brown previously served on the board of Caremark Rx, Inc. from March 2001 until the closing of the merger transaction involving CVS Health and Caremark, when he became a director of CVS Health. Skills and Qualifications of Particular Relevance to CVS Health Mr. Brown’s legal expertise and health care experience are highly valued by the Board, as is his ability to analyze and interpret complex issues and facilitate Board engagement. He has a broad background in large-scale corporate and real estate transactions, both domestically and internationally. Mr. Brown has significant health care experience, including through his oversight of UF Health while serving as Chairman of the Board of Trustees for the University of Florida and as a member of the board of directors and executive committee of Orlando Health, a not-for-profit health care network. The Board believes that Mr. Brown’s experience adds knowledge and leadership depth to the Board. | | | Business Development and Corporate Transactions | | | | Corporate Governance and Sustainability | | | | Health Care and Health Services | | | | Public Policy and Government Affairs | | | | Risk Management | |

  17. Biographies of our Incumbent Board Nominees

    | | Alecia A. DeCoudreaux, 69 | Independent Director | | | President Emerita of Mills College at Northeastern University and Former Executive at Eli Lilly and Company Director since: March 2015 Race/Ethnicity and Gender: African-American Female | Education: B.A., Wellesley College; J.D., Maurer School of Law at Indiana University CVS Health Board Committees: Health Services and Technology; Nominating and Corporate Governance Other Public Board: Parnassus Funds/Parnassus Income Funds |

  18. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Ms. DeCoudreaux is President Emerita of the former Mills College, a liberal arts college for women with graduate programs for women and men, which is now known as Mills College at Northeastern University, having served a five-year term as President from July 2011 through June 2016. Previously, Ms. DeCoudreaux served in a number of leadership roles at Eli Lilly and Company, a global pharmaceutical manufacturer (“Eli Lilly”), including as Vice President and Deputy General Counsel, Specialty Legal Team, from 2010-2011, Vice President and General Counsel, Lilly USA, from 2005-2009, and Secretary and Deputy General Counsel of Eli Lilly from 1999-2005. During her 30-year career with Eli Lilly, Ms. DeCoudreaux also previously served as Executive Director of Lilly Research Laboratories, Director of Federal Government Relations, Director of State Government Relations and Director of Community Relations. In addition, Ms. DeCoudreaux has served on a number of charitable, educational, for profit and nonprofit boards, including as both a trustee and board chair at Wellesley College. She currently serves as Lead Independent Trustee and Chair of the Board of Trustees of Parnassus Funds/Parnassus Income Funds, a family of investment funds that integrates environmental, social and governance factors and fundamental investment principles. Skills and Qualifications of Particular Relevance to CVS Health Ms. DeCoudreaux has more than 30 years of experience in the pharmaceutical industry, and her experience as an attorney in that field and in the area of corporate governance makes her a great asset to our Board. | | | Corporate Governance and Sustainability | | | | Health Care and Health Services | | | | Public Policy and Government Affairs | | | | Regulated Industries | | | | Risk Management | |

  19. Biographies of our Incumbent Board Nominees

    | | Nancy-Ann M. DeParle, 67 | Independent Director | | | Managing Partner and Co-Founder of Consonance Capital Partners, LLC and Former Director of the White House Office of Health Reform Director since: September 2013 Race/Ethnicity and Gender: Eurasian Female | Education: B.A., University of Tennessee; B.A. and M.A., Balliol College, Oxford University; J.D., Harvard Law School CVS Health Board Committees: Nominating and Corporate Governance (Chair); Health Services and Technology; Executive (through the Annual Meeting) Other Public Board: HCA Healthcare, Inc. |

  20. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Ms. DeParle has been a Managing Partner of Consonance Capital Partners, LLC, a private equity firm focused on investing in small and mid-size health care companies, since March 2020, and was a Partner from August 2013 until March 2020. She also is a Co-founder of the firm. From March 2009 to January 2013, Ms. DeParle served in the White House, first as Counselor to the President and Director of the White House Office of Health Reform, and later as Assistant to the President and Deputy Chief of Staff for Policy. From 1997 to 2000, Ms. DeParle served as the Administrator of the Centers for Medicare & Medicaid Services (then known as the Health Care Financing Administration), and from 1993 to 1997, she served as the Associate Director for Health and Personnel for the White House Office of Management and Budget, or OMB. From 2001 to March 2009, Ms. DeParle served as a Senior Advisor with JPMorgan Partners and as a Managing Director of its successor entity, CCMP Capital, L.L.C., focusing on private equity investments in health care companies. Ms. DeParle is also currently a director of HCA Healthcare, Inc., a health care services company that owns, manages or operates hospitals and other health care facilities. She has extensive experience serving on the boards of both public and privately held companies, particularly in the health care space. Skills and Qualifications of Particular Relevance to CVS Health Ms. DeParle has more than 25 years of experience in the health care arena. She is widely considered to be one of the nation’s leading experts in health care policy, management and financing, which makes her an excellent fit for our Board. Her background in public policy and government affairs, legal and regulatory compliance, and corporate governance and sustainability makes her an excellent Chair of our Nominating and Corporate Governance Committee. | | | Business Development and Corporate Transactions | | | | Corporate Governance and Sustainability | | | | Health Care and Health Services | | | | Public Policy and Government Affairs | | | | Risk Management | |

  21. Biographies of our Incumbent Board Nominees

    | | Roger N. Farah, 71 | Independent Director | | | Chair of the Board of CVS Health Corporation, Former Chairman of Tiffany & Co. and Former Executive at Tory Burch and Ralph Lauren Director since: November 2018 Race/Ethnicity and Gender: White Male | Education: B.S., University of Pennsylvania CVS Health Board Committees: Management Planning and Development; Nominating & Corporate Governance; Executive (Chair) Other Public Board: The Progressive Corporation |

  22. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Farah has been Independent Chair of the Board of CVS Health since May 2022. He is the former Chairman of the Board and a director of Tiffany & Co., a retailer of jewelry and specialty products, having served in that role from October 2017 to January 2021. He served as Executive Director of Tory Burch LLC, a retailer of lifestyle products, from March 2017 to September 2017, having previously served as Co-Chief Executive Officer and director from September 2014 to February 2017. He is former Executive Vice Chairman of Ralph Lauren Corporation, a retailer of lifestyle products, having served in that position from November 2013 to May 2014, and previously served as President and Chief Operating Officer (“COO”) from April 2000 to October 2013, and a director from April 2000 to August 2014. During his 40-plus year career in retailing, Mr. Farah also held director and/or executive positions with Venator Group, Inc. (now Foot Locker, Inc.), R.H. Macy & Co., Inc., Federated Merchandising Services, the central buying and product development arm of Federated Department Stores, Inc., Rich’s/Goldsmith’s Department Stores, and Saks Fifth Avenue, Inc. Mr. Farah was a member of the board of directors of Aetna from 2007 until the closing of the Aetna Transaction, when he became a director of CVS Health. He was a director of Metro Bank PLC, a financial services company, until his retirement from that board in March 2020. He currently serves as a director of The Progressive Corporation, an auto insurance company. Skills and Qualifications of Particular Relevance to CVS Health Mr. Farah brings extensive business and leadership experience to our Board. He has strong marketing, brand management and consumer insights from his over 40 years of experience in the retail industry. His former positions as Executive Vice Chairman, President and COO of Ralph Lauren and Executive Director and Co-CEO of Tory Burch give Mr. Farah important perspectives on the complex financial and operational issues facing the Company. The Board believes that his experience as a board chair and executive leading consumer-facing companies makes him very well suited to serve as Independent Chair of our Board. | | | Business Development and Corporate Transactions | | | | Business Operations | | | | Corporate Governance and Sustainability | | | | Finance | | | | Risk Management | |

  23. Biographies of our Incumbent Board Nominees

    | | Anne M. Finucane, 71 | Independent Director | | | Chair of the Board of Rubicon Carbon and Former Vice Chairman of Bank of America Corporation Director since: January 2011 Race/Ethnicity and Gender: White Female | Education: B.A., University of New Hampshire CVS Health Board Committees: Audit; Management Planning and Development; Executive (following the Annual Meeting) Other Public Board: Williams Sonoma, Inc. |

  24. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Ms. Finucane has been a Senior Advisor of the TPG Climate Rise Fund (“TPG”), an investment fund focused on various climate sub-sectors, since September 2022 and the Chair of the Board of Rubicon Carbon, a carbon credit firm and a TPG portfolio company, since November 2022. Previously, Ms. Finucane served as Chairman of the Board of Bank of America Europe from July 2018 through December 2022. Ms. Finucane served as a Vice Chairman of Bank of America Corporation, an international financial services company, from July 2015 until her retirement in December 2021. From 2006 through July 2015, Ms. Finucane served as Global Chief Strategy and Marketing Officer for Bank of America and served as Northeast Market President from 2004 through July 2015. As a member of the executive management team, Ms. Finucane was responsible for the strategic positioning of Bank of America and led the company’s environmental, social and governance, sustainable finance, capital deployment and global public policy efforts. She established and co-chaired the company’s Sustainable Finance Committee, which included a $1 trillion environmental business initiative, deploying capital to help accelerate the transition to a low-carbon, sustainable economy, and was chair of Bank of America’s Environmental, Social and Governance Committee. She currently serves as a director of Williams Sonoma, Inc., a retailer of kitchen and home products. Skills and Qualifications of Particular Relevance to CVS Health Ms. Finucane’s experience in the financial services industry, consumer policy, strategy, marketing, corporate social responsibility, global public policy and government affairs provides our Board with valuable insight in those key areas. Her distinguished career in banking also makes her a valued member of the Audit and Management Planning and Development Committees. | | | Business Development and Corporate Transactions | | | | Corporate Governance and Sustainability | | | | Public Policy and Government Affairs | | | | Regulated Industries | | | | Risk Management | |

  25. Biographies of our Incumbent Board Nominees

    | | J. Scott Kirby, 56 | Independent Director | | | Chief Executive Officer and Member of the Board of Directors of United Airlines Holdings, Inc. Director since: October 2023 Race/Ethnicity and Gender: White Male | Education: B.S., U.S. Air Force Academy; M.S., George Washington University CVS Health Board Committees: Health Services and Technology Other Public Board: United Airlines Holdings, Inc. |

  26. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Kirby has been the Chief Executive Officer and a member of the Board of Directors of United Airlines Holdings, Inc. (“United Airlines”), an international air carrier, since May 2020. Mr. Kirby also serves on the Executive Committee and the Finance Committee of the United Airlines Board of Directors. From August 2016 until May 2020, Mr. Kirby was President of United Airlines and was responsible for its operations, marketing, sales, alliances, network planning and revenue management. Prior to joining United Airlines, he was President of American Airlines from December 2013 until August 2016 and was President of US Airways from September 2006 until December 2013, when US Airways merged with American Airlines. He started his career at the Pentagon and in the technology sector. Mr. Kirby is a member of the Board of Directors of SONIFI Solutions, a privately held manufacturer of integrated technology and service platforms. He also currently serves as the Chairman of the Star Alliance Chief Executive Board, a global alliance consisting of 26 member airlines, and is a member of the Board of Governors of the International Air Transport Association, a trade association comprised of 240 of the world’s airlines. Mr. Kirby is also a member of the Board of Directors of the U.S. Air Force Academy Foundation. Skills and Qualifications of Particular Relevance to CVS Health Mr. Kirby is a well-known airline industry veteran, with a broad and accomplished three-decade-long career in significant leadership roles. Mr. Kirby brings valuable expertise to the Board from his experience with marketing, sales, alliances and network planning at United Airlines, as well as his education and background in technology. As CEO of a large public company who is responsible for its business and ongoing operations, he has experience and understanding of how to implement strategic priorities. These skills make him well qualified to serve as a member of the Health Services and Technology Committee. | | | Business Development and Corporate Transactions | | | | Finance | | | | Public Policy and Government Affairs | | | | Regulated Industries | | | | Technology and Innovation | |

  27. Biographies of our Incumbent Board Nominees

    | | Karen S. Lynch, 61 | Non-Independent Director | | | President and Chief Executive Officer of CVS Health Corporation Director since: February 2021 Race/Ethnicity and Gender: White Female | Education: B.S., Boston College, Executive M.B.A., Boston University CVS Health Board Committees: Executive Other Public Boards: None |

  28. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Ms. Lynch became Chief Executive Officer and President of CVS Health on February 1, 2021. Prior to this appointment, Ms. Lynch served as an Executive Vice President of CVS Health and President of Aetna from November 2018 through January 2021 where she was responsible for delivering consumer-centric, holistic health care to the millions of people Aetna serves. Ms. Lynch also served as President of Aetna Inc. from 2015 until January 2021. She previously served as Executive Vice President of Aetna’s Local and Regional Business from 2013 to 2014 and Executive Vice President of Aetna’s Specialty Products Business from 2012 to 2013. Before joining Aetna, Ms. Lynch held executive positions at Magellan Health Services, a health care management company, where she served as president, and at Cigna Corporation, a global health insurance company. Ms. Lynch began her career as a certified public accountant at the auditing firm of Ernst & Young LLP. Ms. Lynch served on the board of directors of U.S. Bancorp, a financial services holding company, from 2015 to 2022. Ms. Lynch also has experience serving on not-for-profit boards and on the boards of trade associations. Skills and Qualifications of Particular Relevance to CVS Health Ms. Lynch is a seasoned health care expert who has over three decades of experience in the industry and currently leads more than 300,000 purpose-driven colleagues. Under Ms. Lynch’s leadership, CVS Health touches the lives of more than 120 million consumers through its health care benefits and pharmacy benefits management businesses, and presence in over 9,000 community health destinations across the U.S. She is consistently rated as a top innovator and influencer in the health care space and has been recognized for her leadership in health care. Ms. Lynch has been named to Fortune’s Most Powerful Women in Business list in each of the past eight years, and topped the list in each of the last three years. Ms. Lynch is the right leader to guide CVS Health into its next era of growth as the Company continues its transformation. | | | Business Development and Corporate Transactions | | | | Business Operations | | | | Finance | | | | Health Care and Health Services | | | | Regulated Industries | |

  29. Biographies of our Incumbent Board Nominees

    | | Michael F. Mahoney, 59 | Independent Director | | | Chairman, President and CEO of Boston Scientific Corporation Director since: November 2023 Race/Ethnicity and Gender: White Male | Education: B.B.A., University of Iowa; M.B.A., Wake Forest University CVS Health Board Committees: Management Planning and Development; Executive (following the Annual Meeting) Other Public Board: Boston Scientific Corporation |

  30. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Mahoney has been the President of Boston Scientific Corporation (“Boston Scientific”), a global developer, manufacturer and marketer of medical devices, since October 2011, and has been Chief Executive Officer and a member of the Board of Directors of Boston Scientific since November 2012. He became Chairman of the Board of Directors of Boston Scientific in May 2016. Prior to joining Boston Scientific, Mr. Mahoney served as Worldwide Company Group Chairman of Johnson & Johnson’s DePuy franchise, an orthopedics and neurosciences business, from April 2007 through January 2011. From January 2001 through March 2007, he served as President and Chief Executive Officer of Global Healthcare Exchange, a leading medical supply chain solutions company. Mr. Mahoney began his career at General Electric Medical Systems, where he spent 12 years, culminating in the role of General Manager of the Healthcare Information Technology business. From October 2015 until September 2023, Mr. Mahoney served as a member of the Board of Directors of Baxter International Inc. Skills and Qualifications of Particular Relevance to CVS Health Mr. Mahoney has extensive experience leading global, medical products companies, including most recently as Chairman, President and Chief Executive Officer of Boston Scientific Corporation. His management experience includes leading complex organizations in medical device and other healthcare-related businesses, expertise in building strong leadership teams, developing international markets, and a proven ability to execute successful business strategies and drive operational excellence. Mr. Mahoney also has significant knowledge of the global medical products business and extensive experience leading and operating within global, multi-faceted medical products companies as a result of his roles at Boston Scientific and Johnson & Johnson. | | | Business Development and Corporate Transactions | | | | Business Operations | | | | Finance | | | | Health Care and Health Services | | | | Technology and Innovation | |

  31. Biographies of our Incumbent Board Nominees

    | | Jean-Pierre Millon, 73 | Independent Director | | | Former President and Chief Executive Officer of PCS Health Systems, Inc. Director since: March 2007 Race/Ethnicity and Gender: White Male | Education: B.S., Ecole Centrale de Lyon (France); B.A., Université de Lyon (France); M.B.A., Kellogg School of Business, Northwestern University CVS Health Board Committees: Audit; Health Services and Technology (Chair) Other Public Boards: None |

  32. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Mr. Millon is the former President and Chief Executive Officer of PCS Health Systems, Inc. (“PCS”), a pharmacy benefit management company. Mr. Millon joined PCS in 1995, where he served as President and Chief Executive Officer from June 1996 until his retirement in September 2000. Prior to that, Mr. Millon served as an executive of and held several global leadership positions with Eli Lilly and Company, a global pharmaceutical manufacturer. Mr. Millon previously served on the board of Caremark from March 2004, upon Caremark’s acquisition of AdvancePCS, and as a director of AdvancePCS (which resulted from the merger of PCS and Advance Paradigm, Inc.) beginning in October 2000. He became a director of CVS Health upon the closing of the merger transaction involving CVS Health and Caremark. Mr. Millon has over ten years of financial management experience and 15 years of general functional management experience, including strategic planning experience specific to pharmacy benefit management companies as the former head of PCS. He also has extensive venture capital and public and private company board experience. Skills and Qualifications of Particular Relevance to CVS Health Mr. Millon’s extensive background and experience in the pharmacy benefit management, pharmaceutical and life sciences businesses, combined with his financial expertise, provide our Board with additional perspective across the enterprise, and make him well qualified to serve as the Chair of our Health Services and Technology Committee. | | | Business Operations | | | | Finance | | | | Health Care and Health Services | | | | Risk Management | | | | Technology and Innovation | |

  33. Biographies of our Incumbent Board Nominees

    | | Mary L. Schapiro, 68 | Independent Director | | | Vice Chair for Global Public Policy and Special Advisor to the Founder and Chairman of Bloomberg L.P., and former Chairman of the U.S. Securities and Exchange Commission Director since: May 2017 Race/Ethnicity and Gender: White Female | Education: B.A., Franklin and Marshall College; J.D., George Washington University CVS Health Board Committees: Audit; Health Services and Technology Other Public Board: Morgan Stanley |

  34. Biographies of our Incumbent Board Nominees

    | Director Qualification Highlights | | Biographical Information Since October 2018, Ms. Schapiro has been Vice Chair for Global Public Policy and Special Advisor to the Founder and Chairman of Bloomberg L.P., a privately held financial, software, data and media company. She was Vice Chair of the Board of the Value Reporting Foundation, formerly the Sustainability Accounting Standards Board until the Value Reporting Foundation was absorbed into the International Financial Reporting Standards Foundation in 2022. From January 2014 through December 2018, Ms. Schapiro served as Vice Chair of Promontory Advisory Board, part of Promontory Financial Group, a leading strategy, risk management and regulatory compliance firm. From January 2009 through December 2012, Ms. Schapiro was Chairman of the U.S. Securities and Exchange Commission, becoming the first woman to serve as that agency’s Chairman. Ms. Schapiro was Chairman and CEO of the Financial Industry Regulatory Authority (“FINRA”) from 2006 through 2008, and held a number of key executive positions at FINRA and its predecessor from 1996 through 2006. She also served as Chairman of the U.S. Commodity Futures Trading Commission (“CFTC”) from 1994 to 1996. Ms. Schapiro is currently a director of Morgan Stanley, a global financial services company. Skills and Qualifications of Particular Relevance to CVS Health Ms. Schapiro’s experience in leading the SEC, FINRA and the CFTC makes her extremely well qualified to serve on our Board. Ms. Schapiro’s leadership of the SEC during the turbulent period that followed the 2008 financial crisis, one of the busiest rulemaking periods in the agency’s history, demonstrates her ability to navigate through a difficult and complex regulatory and political environment. Our Board believes that her skills fill important needs in the areas of legal and regulatory compliance, sustainability and climate risk, finance, risk management and public policy and government affairs. | | | Corporate Governance and Sustainability | | | | Finance | | | | Public Policy and Government Affairs | | | | Regulated Industries | | | | Risk Management | |

  35. Non-Employee Director Compensation

    Non-Employee Director Compensation CVS Health’s approach to compensating non-employee directors for Board service is to provide directors with an annual retainer comprised typically of 75% paid in shares of our common stock and 25% paid in cash (or up to 100% stock at the director’s election). The payment of a significant portion of the annual retainer, and additional retainers as outlined below, in our common stock is consistent with our policy of using equity compensation to better align directors’ interests with stockholders. This also enhances the directors’ ability to meet and continue to comply with our stock ownership guidelines, which are described below. For the 2023-2024 Board year, the total annual retainer for non-employee directors was $335,000, consisting of shares of our stock valued at $251,250 (the annual stock retainer) and a cash payment of $83,750 (unless the director elected to receive up to 100% of the annual retainer in shares of our common stock). However, as previously disclosed, the Board agreed to a reduction in non-employee director compensation of 10% for the directors elected at the 2023 Annual Meeting, so the retainer fee was reduced by $33,500, and the total stock value was $217,750. Each retainer was paid in two installments, in May and November, with the reduction reflected in the May stock payment. Directors may elect to defer receipt of shares, and deferred shares are credited with dividend reinvestment shares to the extent dividends are paid to stockholders. There are no meeting fees. Ad hoc committees of the Board may be established from time to time to work on special projects and members may receive additional compensation for these services, as approved by the Board.

  36. All Other Non-Employee Director Compensation and Benefits

    All Other Non-Employee Director Compensation and Benefits Directors are eligible to participate in the employee discount program in the Company’s stores and are subject to the same terms of the program as our employees. Directors are generally reimbursed for business expenses incurred directly in connection with their roles and duties on the Board, such as travel, meals, lodging and executive support. The following table shows amounts paid to each of our non-employee directors in 2023.

  37. Non-Employee Director Compensation – 2023

    Non-Employee Director Compensation – 2023

  38. Non-Employee Director Compensation – 2023

    | Name | Fees Earned and Paid in Cash(1) ($) | Cash Fees Elected to be Paid in Stock(2) ($) | Stock Awards(2) ($) | All Other Compensation ($) | Total(2) ($) | | Fernando Aguirre(3) | 87,932 | 0 | 230,235 | — | 318,167 | | Jeffrey R. Balser, M.D., Ph.D. | 83,778 | 0 | 217,722 | — | 301,500 | | C. David Brown II | 88,750 | 0 | 232,750 | — | 321,500 | | Alecia A. DeCoudreaux | 83,750 | 0 | 217,750 | — | 301,500 | | Nancy-Ann M. DeParle | 88,826 | 0 | 232,674 | — | 321,500 | | Roger N. Farah | 0 | 152,500 | 424,000 | — | 576,500 | | Anne M. Finucane | 88,826 | 0 | 232,674 | — | 321,500 | | J. Scott Kirby(4) | 7,108 | 41,875 | 146,434 | — | 195,417 | | Edward J. Ludwig(5) | 3,125 | 83,750 | 227,125 | — | 314,000 | | Michael F. Mahoney(6) | 41,891 | 0 | 125,609 | — | 167,500 | | Jean-Pierre Millon | 88,826 | 0 | 232,674 | — | 321,500 | | Mary L. Schapiro | 83,750 | 0 | 217,750 | — | 301,500 |

  39. Non-Employee Director Compensation – 2023

    | (1) The amounts shown include cash payments made in lieu of fractional shares to Mmes. DeParle and Finucane, Dr. Balser and Messrs. Aguirre, Kirby, Mahoney and Millon. | | (2) The annual retainer for 2023 was voluntarily reduced by 10% ($33,500) for the directors elected at the 2023 Annual Meeting. As a result, the total retainer of $301,500 was payable in stock ($217,750) and cash or stock ($83,750). During 2023, each director receiving a 12-month retainer received 3,146 shares of stock with a total value of $217,750 on the date of grant; each director electing to receive the remaining portion of the annual retainer in stock also received 1,209 shares valued at $83,750 on the date of grant. These awards are fully vested at grant and the amounts shown represent both the fair market value and the full fair value at grant. As of December 31, 2023, our directors had deferred balances of shares of Company common stock, including dividends, as follows: Mr. Brown, 78,483 shares; Ms. DeCoudreaux, 29,199 shares; Ms. DeParle, 3,480 shares; Mr. Farah, 29,639 shares; Ms. Finucane, 7,408 shares; Mr. Ludwig, 14,522 shares; and Ms. Schapiro, 17,734 shares. The total reflects a one-time reduction in non-employee director compensation of 10% for 2023, taken in May 2023 for directors elected at the 2023 Annual Meeting. | | (3) Mr. Aguirre received a pro rata retainer in connection with his appointment as Audit Committee Chair in September 2023. | | (4) Mr. Kirby joined the Board in October 2023. His compensation reflects a pro rata retainer of $195,417 for the portion of the 2023-2024 Board year that he is serving. | | (5) Mr. Ludwig received 50% of the Audit Committee Chair retainer in May 2023; he did not receive any Chair retainer in November 2023, as Mr. Aguirre had been appointed Audit Committee Chair in September 2023. | | (6) Mr. Mahoney joined the Board in November 2023. His compensation reflects a pro rata retainer of $167,500 for the portion of the 2023-2024 Board year that he is serving. |

  40. Engagement on Potential 2024 Compensation Updates

    Engagement on Potential 2024 Compensation Updates We also sought input from stockholders on 2024 compensation design matters that were being considered by the MP&D Committee for awards granted to our senior executives. The MP&D Committee sought this feedback so that their final decisions could be informed by stockholder views. Among other topics, we discussed with stockholders: whether the equity mix for the 2024 annual long-term incentive award should include the use of restricted stock units (“RSUs”); whether the post-vesting holding period on PSUs should be revised; and whether the Workforce Modifier used in the annual cash Management Incentive Plan should remain a downward only modifier and/or be expanded to capture culture more broadly. The MP&D Committee determined that several components of our existing compensation structure are not aligned to broader market or industry practices, which may have resulted in unintended consequences for CVS Health and our stockholders in terms of attracting and retaining the best possible talent. After careful deliberation, which included consideration of feedback following proactive engagement with our stockholders and the advice of our independent compensation consultant, the MP&D Committee made several updates to the annual long-term incentive compensation program effective for 2024 that we believe will best serve the Company at this time:

  41. Engagement on Potential 2024 Compensation Updates

    | Compensation Element | MP&D Committee Considerations, Stockholder Feedback and 2024 Determination | | Equity Mix and Metrics for 2024 Annual Long-Term Incentive Award | MP&D Committee Considerations • CVS Health’s executive compensation program is primarily variable pay (~90%), with the long-term equity portion making up ~75% of executive pay. The 2023 equity mix was comprised of 75% PSUs and 25% stock options • The Incentive Plan Design Review performed by the MP&D Committee’s independent compensation consultant demonstrated that CVS Health’s program does not align with market practice, with most peers granting some portion of their annual award in RSUs • The equity mix that did not include RSUs is unusual and outside of market practice which may interfere with recruiting the highest caliber talent • RSUs provide a level of retention that is appropriate in a balanced portfolio of equity and are part of the annual equity award mix for non-ELT executives which supports our Executive Compensation Core Principles of retaining the highest caliber talent Stockholder Feedback • Stockholders requested clear disclosure of the MP&D Committee’s rationale for any changes • Most stockholders were not prescriptive regarding the mix of equity or the metrics used, provided that at least a majority of the award is performance-based and performance is based on objective criteria • Some stockholders discussed recent studies indicating a strong correlation between RSUs and long-term performance, and a shifting preference for greater emphasis on RSUs • Some stockholders favored the highly-leveraged plan • Most stockholders preferred limited use of stock options • Some stockholders suggested that we modify our approach to measuring performance under the Adjusted EPS goal for the PSUs so that it is not measured only at the end of the three-year performance period • Some stockholders preferred more than one long-term metric and asked that we consider another objective metric or use rTSR as a metric rather than a modifier Final Determination for 2024 • 2024 annual equity mix for NEOs will be 60% PSUs, 20% RSUs and 20% stock options, maintaining a program that is heavily focused on performance while addressing risk • Reflects stockholder input that at least a majority of long-term equity is in the form of PSUs • Adds a modest amount of RSUs to the equity mix to more closely align with market practice (nearly 70% of peers include RSUs) and reduces recruiting and retention risks • Reduces use of stock options to more closely align with market practice • Maintain Adjusted EPS metric with a 70% weighting, but transition to a cumulative goal measured over the full three-year performance period rather than measuring performance based on the last year of the performance period • Add a second metric weighted at 30% that is objective and measurable over a three-year period related to the strategic initiatives discussed at our December 2023 Investor Day presentation |

  42. Engagement on Potential 2024 Compensation Updates

    | Post-Vesting Holding Period for PSUs | MP&D Committee Considerations, Stockholder Feedback and 2024 Determination • CVS Health’s post-vesting holding period for PSUs results in a five-year period before the majority of an NEO’s total compensation can be monetized • The Incentive Plan Design Review performed by the MP&D Committee’s independent compensation consultant demonstrated that the two-year holding period is not market practice and only one peer company has a post-vesting holding period • CVS Health has robust stock ownership guidelines that apply to NEOs, with holding requirements for the CEO at 7x salary and for other NEOs at 4x salary, further ensure alignment with the interests of our long-term stockholders • The two-year holding period was identified as unusual and beyond market practice, which may interfere with recruiting the highest caliber talent Stockholder Feedback • Stockholders generally understood the potential risks from a talent management perspective created by the two-year holding period • Most stockholders did not have a strong view on the holding period and were not concerned with proposed changes provided the performance measurement period was at least three years Final Determination for 2024 • Maintain a post-vesting holding period (for net shares) to align with stockholders; beginning with the 2024 PSU grant, but reduce the post-vesting holding period to one year to move closer to market and provide more symmetry with stock options, which vest over four years | | Maintaining Negative-Only Workforce Modifier in the Annual Cash Management Incentive Plan (“MIP”) | MP&D Committee Considerations • CVS Health added a discretionary, downward-only modifier to its annual cash Management Incentive Plan for the 2021 plan year and maintained that modifier through 2023 focused on colleague representation, training, development and retention. As the negative modifier was expanded to apply to a broader group of employees in 2023, the MP&D Committee considered whether the scope should also be expanded to capture our culture more broadly • Our values support a broad definition of diversity, equity, inclusion and belonging; colleagues also view diversity, equity, inclusion and belonging broadly and are supported by our 16 Colleague Resource Groups and requests for enhanced disclosure around attributes such as disability, veteran status, race and ethnicity and gender identity • Providing and maintaining an environment of engagement, inclusion and belonging is important to our enterprise and can be assessed through our engagement surveys • A negative-only modifier is appropriate because these are fundamental expectations and management should not be rewarded above Company performance for meeting these expectations Stockholder Feedback • Most stockholders appreciated the use of a negative-only modifier and were supportive of the proposed change to expand the metric, provided there is transparency at the end of the performance period on what was measured Final Determination for 2024 • Maintain a downward-only modifier and evolve the metric to represent culture measured through objective results under colleague engagement surveys |

  43. Engagement on Potential 2024 Compensation Updates

    In addition, after receiving a stockholder proposal and considering stockholder perspectives broadly, the MP&D Committee adopted a policy that it would not enter into any new employment, severance or separation agreements or establish any new severance policy that would provide cash severance benefits exceeding 2.99 times the sum of base salary and target bonus to any Section 16 officers, including our NEOs, without seeking stockholder approval. See pages 9-11 of this proxy statement for additional information about stockholder engagement.

  44. We apply leading executive compensation practices

    | | Performance Measures Aligned with Stockholder Interests | | Recoupment Policies and Commitment to Disclose any Recoupment | | | Majority of the Total Compensation Opportunity is Performance-Based | | Limited Perquisites and Personal Benefits | | | Long-Term Incentive Grants are Capped | | No Excise Tax Gross-Ups | | | Post-vesting Holding Period on Net Shares Resulting from PSUs for NEOs | | Broad-Based Severance Plan for Executives | | | No Upward Modifier to any Outstanding PSUs if Absolute TSR is Negative | | Robust Stock Ownership Guidelines | | | Dividend Equivalents on RSUs Paid Only When Awards Vest | | Broad Anti-Pledging and Anti-Hedging Policy | | | Double Trigger Vesting of Equity Awards | | Reconciliation in Proxy Statement of any Non-GAAP Performance Metric to the Most Directly Comparable GAAP Financial Measure | | | No Option Repricing; No Recycling of Shares | | Board Committee Oversight of Comprehensive Annual Compensation Program Risk Assessment | | | Cash Severance Policy Capped at 2.99x Base Plus Bonus | | Diversity/Inclusion Metric in the MIP for Senior Executives |

  45. Executive Compensation Program Discussion

    Executive Compensation Program Discussion Our executive compensation program supports our long-term strategy by tying the majority of pay for executives to performance-based metrics aligned to the Company’s growth strategy. For our 2023 annual executive compensation program, we provide three elements of total direct compensation: base salary, annual cash incentive and long-term incentives in the form of PSUs and stock options, which are described in detail beginning on page 59.

  46. Executive Compensation 2023 Planning and Review Process

    | • | Annual cash incentive awards were decided and approved by the MP&D Committee in February 2024 and reflect Company and individual performance in 2023 against performance goals that were established in the first quarter of 2023. | | • | Long-term incentive awards reflect individual performance and the future potential to drive our corporate strategy and growth. Annual long-term incentive awards for NEOs who were in their role in April 2023 were granted as |

  47. Executive Compensation 2023 Planning and Review Process

    PSUs and stock options. The performance goals for the 2023 PSUs were approved in March 2023 for the period January 1, 2023 – December 31, 2025. The MP&D Committee will determine whether performance is achieved in February 2026; if performance criteria are met, PSUs will vest based on continued employment through April 1, 2026, and the net shares, if any, will be subject to a two-year holding period.

  48. Executive Compensation 2023 Planning and Review Process

    | • | The 2023 equity awards for Mr. Cowhey reflect the standard equity mix (stock options, RSUs and PSUs) for the position he held in April 2023. He also received an RSU award granted in November 2023 to reflect his materially increased duties and responsibilities and critical role at the Company as Interim CFO beginning in October 2023. Mr. Khichi joined the Company in February 2023 and received a make-whole award in February 2023 representing the economic equivalent of the cash and equity that he was required to forfeit from his prior employer and was comprised of cash and RSUs subject to vesting and repayment under certain circumstances. (See “Agreements with Named Executive Officers” on page 72). |

  49. 2023 Executive Compensation Program Summary

    | Management Incentive Plan See pages 60-62 for details | The MP&D Committee believes that performance indicators, including profitability, customer experience, market comparability and stock price should continue to be factored into our executive compensation program. In order to maintain year-over-year consistency, the 2023 MIP metric weightings remained unchanged, and the MP&D Committee continued the use of a downward-only Workforce Modifier: 80% Financial (MIP Adjusted Operating Income) 20% Customer Experience (determined based on Net Promoter Score (“NPS”)) Workforce Modifier (downward only, by as much as 10%) for senior leaders (Vice Presidents and above). | | Long-Term Incentive Program See pages 66-69 for details | In 2023, the MP&D Committee followed its normal cycle for setting goals and targets (see page 58) and has maintained year-over-year consistency with the design of our long-term incentives: The 2023 PSU metrics remained unchanged: 100% 2025 Adjusted EPS, with an rTSR modifier; The MP&D Committee continued to cap grant values at 150% of target and limit PSU payouts to 200% of target; No upward rTSR modifier is applied if our absolute TSR is negative; and The rTSR peer group continued to be the companies that make-up the S&P 500 Health Care Index. In 2023, the MP&D Committee used RSU awards to compensate Mr. Cowhey for taking the interim role as CFO to reflect his materially increased duties and responsibilities and critical role at the Company and as a make-whole award for Mr. Khichi as noted above. | | CVS Health Cash Only Severance Policy See page 75 for details | The MP&D Committee adopted an executive cash severance policy, effective for 2024, which provides that without stockholder approval, cash severance paid to our Section 16 officers (including our NEOs) cannot exceed 2.99 times the sum of base salary and target bonus. Since 2010, the severance plan covering executives (other than Ms. Lynch) has provided, and continues to provide, cash severance of 1.5 times base salary, and the change in control agreements with executives (other than Ms. Lynch) provide for 1.5 times base salary plus target bonus. Ms. Lynch’s employment agreement provides cash severance that does not exceed 2.5 times base salary plus target bonus. (See “Agreements with Named Executive Officers” on page 71). |

  50. Incentive Design, Payout, and Goal-Setting Process and Timeline

    Incentive Design, Payout, and Goal-Setting Process and Timeline For the annual and long-term incentive programs, the MP&D Committee oversees a rigorous and comprehensive goal-setting process. Below are highlights of the MP&D Committee’s review and decision-making process for 2023 executive compensation and incentive program target setting. The MP&D Committee structures the timing and process for determining individual NEO compensation so that compensation is appropriately aligned with the financial performance of the Company. On an ongoing basis, the MP&D Committee continues to review our compensation philosophy and objectives in light of Company strategy, goals, performance, stockholder feedback and external benchmarking, monitors compensation in comparison to actual and relative performance and ensures compliance with management equity ownership requirements.

  51. 2023 Executive Compensation Program Structure

    | | Performance-based or performance-aligned (~90%) | | | | | | Near-Term | | Long-Term | | | | Base Salary | Annual Cash Incentive (MIP) | PSUs | Stock Options | | Performance Period | Ongoing | Annual | 3-year performance period plus 2-year holding period post vesting | 4-year ratable vest along with 10-year expiration | | Performance Metrics | | • MIP Adjusted Operating Income (80%) • Net Promoter Score (“NPS”) (20%) • Individual Performance Modifier (0-120%) • Workforce Modifier for VPs and above (downward-only, by as much as 10%) | • 2025 Adjusted EPS (100%) • rTSR Modifier (+/- 25%); no upward modifier to any outstanding PSUs if our absolute TSR is negative | • Stock price appreciation | | Link to Strategy and Performance | Attracts and compensates high-performing and experienced leaders at a competitive level of cash compensation. | Motivates and rewards executives for achieving annual corporate, business unit and functional goals in key areas of financial and operational performance. | Focuses NEOs on the achievement of specific long-term financial performance goals directly aligned with our operating and strategic plans. | Directly aligns the interests of our NEOs with stockholders. Stock options only have value for NEOs if operating performance results in stock price appreciation. | | CEO Target Pay Mix | | | | | | NEO Target Pay Mix | | | | |

  52. Annual Cash Incentive

    Annual Cash Incentive Our NEOs participate in our annual cash incentive program, the Management Incentive Plan or MIP, under which they are eligible for a cash award based on the achievement of pre-established financial, operating and individual performance objectives. Awards are paid out, if earned, in the first quarter of the following year based on the following formula. The MP&D Committee reserves the discretion to reduce awards for any reason.

  53. Annual Cash Incentive

    | NEO Target Annual Incentive % times Base Salary Paid in Performance YearX | Corporate Performance Factor %X | Individual Performance Modifier (0 to 120%)X | Workforce Modifier (downward only, by as much as 10%) | = | Final Award Cannot Exceed 200% of Target |

  54. NEO Target Annual Incentive

    NEO Target Annual Incentive The annual cash incentive award payments for our NEOs are based on the achievement of pre-established, quantifiable performance goals. In the first quarter of each year, the MP&D Committee approves an annual target bonus opportunity for each NEO, expressed as a percentage of the NEO’s base salary. The current targets are set forth in the 2023 Annual Cash Incentive Award table on page 66. The final award is calculated based on the actual base salary paid during the calendar year, which we call “eligible earnings.”

  55. Rigorous Goal Setting

    | | 2022 Results (in millions) | 2023 Target (in millions) | | MIP Adjusted Operating Income* | $17,719 | $18,102 |

  56. Rigorous Goal Setting

    | * MIP Adjusted Operating Income is a non-GAAP financial measure. See Annex A to this proxy statement for a reconciliation of this and other non-GAAP financial measures to the most directly comparable GAAP financial measures. |

  57. 2023 Corporate Performance Results

    | Performance Metric | Minimum | Target | Maximum | Funding Level | Performance Weighting Under Plan | Final Approved Performance Result | | 2023 MIP Adjusted Operating Income(1) (80%) % of Target % Funding | | | | 77.1% | 61.7% | | | NPS Growth(3) (20%) Result vs. Target % Funding | | | | 106.8% | 21.4% | |

  58. 2023 Corporate Performance Results

    | (1) MIP Adjusted Operating Income is a non-GAAP financial measure. See Annex A to this proxy statement for a reconciliation of this and other non-GAAP financial measures to the most directly comparable GAAP financial measures. | | (2) Dollars in millions. The Minimum, Target, Maximum and Actual amounts for 2023 MIP Adjusted Operating Income are all net of bonus-related expenses. | | (3) NPS uses a point-based funding scale. Actual results are the weighted average performance versus target for the businesses, weighted equally. |

  59. 2023 Annual Cash Incentive Award(1)

    2023 Annual Cash Incentive Award(1)

  60. 2023 Annual Cash Incentive Award(1)

    | NEO(1) | 2023 Eligible Earnings | Target Annual Incentive | Full-Year Target Award | Company Perfor- mance | Individual Perfor- mance Modifier | Workforce Modifier | Final Payout as a % of Target | Final Award | | Karen S. Lynch | $1,500,000 | 200% | $3,000,000 | 83.1% | 120% | — | 99.7% | $2,992,000 | | Thomas F. Cowhey(2) | $771,250 | 112% | $862,643 | 83.1% | 110% | — | 91.3% | $788,000 | | Samrat S. Khichi | $753,409 | 100% | $753,409 | 83.1% | 100% | — | 83.1% | $626,000 | | Tilak Mandadi | $1,000,000 | 150% | $1,500,000 | 83.1% | 100% | — | 83.1% | $1,246,000 | | Prem S. Shah | $950,000 | 150% | $1,425,000 | 83.1% | 120% | — | 99.7% | $1,421,000 |

  61. 2023 Annual Cash Incentive Award(1)

    | (1) Mr. Guertin was on an approved leave of absence at the end of 2023 and received a pro-rated award based on 83.1% funding. Mr. Guertin’s award was calculated with a 100% individual performance modifier. | | (2) Mr. Cowhey’s 2023 bonus target was pro-rated to 112% to reflect his target bonus opportunity increase to 150% in October 2023 as a result of his appointment as Interim CFO. |

  62. Long-Term Incentive Compensation

    Long-Term Incentive Compensation Each year the MP&D Committee approves long-term incentive compensation awards for employees, including the NEOs. Following the MP&D Committee’s comprehensive review of our executive compensation program, and considering input from our stockholders, it decided to maintain the mix of PSUs and stock options for 2023, as illustrated below.

  63. 2023 Long-Term Incentive Target Mix

    2023 Long-Term Incentive Target Mix

  64. 2023 Stock Option and PSU Awards

    2023 Stock Option and PSU Awards In 2023, stock options represent 25% of the total value of long-term incentive awards for our NEOs. Stock options are granted at fair market value and vest ratably over a four-year period. The PSU portion of our long-term incentive program (75%) features formulaically-determined payouts based on performance goals established by the MP&D Committee in the first quarter of 2023 and set the performance period to be January 1, 2023 – December 31, 2025, a three-year performance period. The MP&D Committee approved 2025 Adjusted EPS as the core performance measure for the 2023 PSUs, adjusted by an rTSR modifier. These metrics were selected as they align focus on achieving externally communicated growth goals and provide year-over-year consistency in measuring and rewarding performance.

  65. 2023 Stock Option and PSU Awards

    | 2023 Long-Term Incentive Decisions | PSU Program Highlights | | • The MP&D Committee followed its traditional process and set targets in Q1 of 2023 and granted annual equity awards (PSUs and stock options) in April 2023 • PSU metrics (Adjusted EPS and rTSR modifier) were consistent with prior year • Core metric for PSUs: 2025 Adjusted EPS* • The 2025 Adjusted EPS goal was established in Q1 of 2023 and was consistent with the long-term growth rate target communicated to investors in February 2023 | • Maximum payout is 200% • No upward rTSR modifier is applied to PSUs if our absolute TSR is negative • PSU award agreements include clawback/forfeiture in the event of detrimental conduct • Post-vesting holding period applies during and after employment |

  66. 2023 Stock Option and PSU Awards

    | * Adjusted EPS is a non-GAAP financial measure. See Annex A to this proxy statement for a reconciliation of this and other non-GAAP financial measures to the most directly comparable GAAP financial measures. |

  67. 2023 Annual Equity Awards

    2023 Annual Equity Awards

  68. 2023 Annual Equity Awards

    | NEO | Stock Options | PSUs | Annual RSUs | New Hire or Promotion RSUs | | Karen S. Lynch | $4,124,992 | $12,374,971 | $0 | $0 | | Thomas F. Cowhey(1) | $562,490 | $1,124,969 | $562,452 | $499,976 | | Samrat S. Khichi(2) | $1,124,996 | $3,374,969 | $0 | $3,999,979 | | Tilak Mandadi | $1,624,993 | $4,874,990 | $0 | $0 | | Prem S. Shah | $1,499,989 | $4,499,937 | $0 | $0 |

  69. 2023 Annual Equity Awards

    | (1) Mr. Cowhey received RSUs as part of his annual award as a Senior Vice President prior to his appointment as Interim CFO. He also received an RSU award as compensation for his service as Interim CFO in 2023. See “Agreements with Named Executive Officers” for more details on Mr. Cowhey’s compensation. | | (2) Mr. Khichi received a make-whole award when he joined the Company in February 2023. See “Agreements with Named Executive Officers” for more details on Mr. Khichi’s compensation. |

  70. 2023 PSU Summary

    2023 PSU Summary

  71. 2024 Equity Awards

    2024 Equity Awards After considering feedback from investors and potential risks to attracting and retaining talent at a critical time for the Company, and based on market data and input from its independent compensation consultant, the MP&D Committee made the following adjustments to long-term incentive compensation for the 2024 performance year:

  72. 2024 Equity Awards

    | • | Maintain Adjusted EPS metric with a 70% weighting but use a cumulative goal measured over the full three-year performance period. | | • | Add an additional metric with 30% weighting with objective targets that are measurable over a three-year period that support the strategic initiatives related to the commitments made at our December 2023 Investor Day. | | • | Maintain the rTSR modifier. | | • | Maintain a post-vesting holding period (for net shares) to align with stockholders. Beginning with the 2024 PSU grant reduce the post-vesting holding period to one-year to more closely align with market practice and provide more symmetry with stock option awards that vest over four-years. | | • | Add RSUs to move closer to market practice where nearly 70% of peers include a portion of equity awards in RSUs to better support retention and recruiting. | | • | 2024 equity mix for NEOs will be 60% PSUs, 20% RSUs and 20% stock options, maintaining a program that is heavily focused on performance while addressing recruiting and retention and continuing to balance risk and reward. |

  73. 2024 Equity Awards

    See pages 53-54 for a complete discussion of the MP&D Committee’s rationale and considerations regarding the 2024 program.

  74. Prior PSU Performance Programs

    Prior PSU Performance Programs 2021 PSUs – Performance was certified by the MP&D Committee in February 2024, following the three-year performance period. Net shares issued upon settlement are subject to a two-year holding period. The following summarizes the final payout results and settlement of the 2021 PSU awards granted to Ms. Lynch and Messrs. Guertin and Shah (Messrs. Cowhey, Khichi and Mandadi were not employed by the Company at the time of the 2021 grant, and therefore did not receive 2021 PSUs):

  75. Prior PSU Performance Programs

    | 2021 PSUs | STATUS: | | • Three Year Performance Period January 1, 2021 - December 31, 2023; Vesting April 1, 2024; Subject to a mandatory two-year holding period • Based on 2023 Adjusted EPS* with target set at $8.98 - $9.09 in March 2021 and granted in April 2021 • Subject to an rTSR modifier (+/- 25%) | • 2023 PSU Adjusted EPS* of $8.99 at target • rTSR performance just above median (~53.3%) increased the payout level by 3.3% CALCULATED PAYOUT = 103.3% |

  76. Prior PSU Performance Programs

    | * Adjusted EPS and 2023 PSU Adjusted EPS are non-GAAP financial measures. See Annex A to this proxy statement for a reconciliation of these and other non-GAAP financial measures to the most directly comparable GAAP financial measures. |

  77. 2021 PSU Summary

    2021 PSU Summary

  78. 2021 PSU Summary

    | * Adjusted EPS is a non-GAAP financial measure. See Annex A to this proxy statement for a reconciliation of Adjusted EPS and other non-GAAP financial measures to the most directly comparable GAAP financial measures. |

  79. 2021 PSU Summary

    Performance will be certified in February 2025, following the three-year performance period. Net shares issued upon settlement, if any, will be subject to a two-year holding period. Maximum payout after calculation (including application of modifier) cannot exceed 200% of the PSUs awarded.

  80. 2021 PSU Summary

    | * Adjusted EPS is a non-GAAP financial measure. See Annex A to this proxy statement for a reconciliation of Adjusted EPS and other non-GAAP financial measures to the most directly comparable GAAP financial measures. |

  81. 2023 Compensation Peer Group

    2023 Compensation Peer Group 2023 Selection Process: The MP&D Committee uses various data sources, including peer groups, to assess financial performance and compensation competitiveness. While peer groups represent a broad group of potential competitors for executive talent across various industries, peer group data serves as only one reference point for the MP&D Committee in evaluating our compensation program. On an annual basis, the MP&D Committee, with the assistance of its independent compensation consultant, completes a peer group review to determine the most relevant companies for which we compete for talent and capital. The criteria used to identify companies for the peer group include, but are not limited to, size, complexity, business scope, industry and business similarity. The diversified peer group, comprised of 19 companies, remained unchanged in 2023 (the “2023 Compensation Peer Group”). The MP&D Committee utilized the 2023 Compensation Peer Group to set 2023 compensation levels, along with other factors as discussed in “Pay Positioning” on page 70. Full-year 2023 median revenues for the 2023 Compensation Peer Group were $139.1 billion. CVS Health’s full-year 2023 total revenues of $357.8 billion rank at the 93rd percentile relative to the 2023 Compensation Peer Group. The MP&D Committee will continue to review the Company’s peer group annually.

  82. CVS Health 2023 Compensation Peer Group

    CVS Health 2023 Compensation Peer Group

  83. CVS Health 2023 Compensation Peer Group

    | • AbbVie Inc. • Bristol-Myers Squibb Company • Cardinal Health, Inc. • Cencora, Inc.(1) • Centene Corporation • The Cigna Group • Elevance Health, Inc. | • HCA Healthcare, Inc. • Humana Inc. • International Business Machines Corporation • Johnson & Johnson • McKesson Corporation • Merck & Co., Inc. | • Microsoft Corporation • Pfizer Inc. • Target Corporation • UnitedHealth Group Incorporated • Walgreens Boots Alliance, Inc. • Walmart Inc. |

  84. CVS Health 2023 Compensation Peer Group

    | (1) AmerisourceBergen Corporation was renamed Cencora, Inc. in August 2023. |

  85. Pay Positioning

    Pay Positioning The MP&D Committee does not target NEOs’ pay to a specified percentile relative to the 2023 Compensation Peer Group, but rather reviews peer group compensation data for each element of compensation, including base salary, target total cash (base salary plus target bonus) and target total compensation (target total cash plus long-term incentive compensation). Individual compensation positioning relative to comparable positions in the 2023 Compensation Peer Group varies by job, and the MP&D Committee considers a number of factors, including market competitiveness, specific duties and responsibilities of the NEO versus those in similar positions at the 2023 Compensation Peer Group companies, and succession planning. In addition to this assessment, the MP&D Committee considers Company and individual performance and internal pay equity among the Company’s executive officers in evaluating and determining executive compensation. The MP&D Committee believes it is appropriate to reward the Company’s executive officers with compensation above the competitive median if the rigorous financial targets associated with the Company’s variable pay programs are exceeded in a way that is consistent with the Company’s core values.

  86. Other Compensation Arrangements and Benefits

    Other Compensation Arrangements and Benefits The Company maintains broad-based medical and dental benefits, life insurance and short- and long-term disability insurance programs for its full-time employees. Executive officers are eligible to participate in these programs on the same basis and with the same level of financial subsidy as our other salaried employees. Financial subsidies to these plans are tiered so that our highest paid colleagues pay the most. Executive officers may participate in the CVS Health Future Fund 401(k) Plan (the “401(k) Plan”), which is our principal qualified defined contribution plan. An eligible CVS Health employee may defer up to 75% of his or her total eligible compensation, defined as salary plus annual cash incentive, to a maximum deferral limit defined by the Internal Revenue Service (“IRS”). In 2023, that maximum deferral limit was $22,500, plus an additional $7,500 for those age 50 and above. After the first full year of employment, CVS Health will match the employee’s deferrals dollar-for-dollar, each payroll period, up to a maximum of 5% of total eligible compensation subject to IRS limits. CVS Health’s matching cash contributions into the 401(k) Plan for the NEOs who participated are included in the “All Other Compensation” column of the SCT and described in note 8 to the SCT on page 80. The Company also maintains a broad-based severance plan that covers our NEOs, other than Ms. Lynch. Details of potential payments under that plan can be found in the narrative and tables beginning on page 87. The MP&D Committee reviews the Company’s severance benefits annually with the assistance of its independent compensation consultant to evaluate both their effectiveness and competitiveness. The review for 2023 found the current level of benefits to be within competitive norms for design. Details of hypothetical payments that would have been made to our NEOs upon a change in control on December 31, 2023 and under various termination scenarios, provisions for the treatment of equity awards and other benefits, and estimated payments that would be made to the executives whose employment terminates following a change in control may be found in “Payments/(Forfeitures) Under Termination Scenarios” beginning on page 87. For a description of Ms. Lynch’s employment agreement, see “Agreements with Named Executive Officers.”

  87. Karen S. Lynch

    Karen S. Lynch In connection with Ms. Lynch’s appointment as President and Chief Executive Officer of CVS Health, CVS Health entered into an Employment Agreement with Ms. Lynch, effective February 1, 2021. The Employment Agreement sets forth, among other things, the terms of her employment as President and Chief Executive Officer of CVS Health. The Employment Agreement has no specified term and provides that Ms. Lynch’s employment with CVS Health will be on an at-will basis. Further, pursuant to the Employment Agreement, Ms. Lynch will receive an annualized base salary of at least $1.45 million (which was increased to $1.5 million in 2022) and will be eligible to participate in CVS Health’s annual bonus plan with a target annual cash incentive opportunity of 200% of her base salary, effective February 1, 2021. Upon a qualifying termination of employment, Ms. Lynch would be entitled to a cash severance payment equal to two times (which is increased to two-and-a-half times if the qualifying termination of employment occurs within two years following a change in control) the sum of her highest base salary in effect during the six-month period immediately prior to the date of her termination of employment and her target annual bonus opportunity for the year of her termination of employment. Ms. Lynch would also be entitled to a pro-rated annual bonus for the year of her termination of employment and up to 18 months of continued health and benefit plan participation at the same benefit and cost sharing level at which Ms. Lynch and her eligible dependents were participating on the date of her termination of employment. Ms. Lynch will also be treated as retirement eligible under the terms of her equity awards.

  88. Thomas F. Cowhey

    Thomas F. Cowhey Mr. Cowhey joined the Company in February 2022 and was appointed Interim CFO in October 2023. In connection with his appointment as Interim CFO, the MP&D Committee approved compensation for Mr. Cowhey during the interim period to reflect his materially increased duties and responsibilities and critical role at the Company as follows: base salary of $850,000, annual cash incentive target of 150% of his annual base salary, and he was provided a monthly stipend of $75,000. In addition, Mr. Cowhey received a one-time RSU award with a grant date value of $500,000 (the “Interim CFO Equity Award”), which will cliff vest on the third anniversary of the grant date, subject to the terms of the underlying award agreement. Mr. Cowhey also entered into CVS Health’s customary CIC Agreement for executives and a restrictive covenant agreement which includes, among other things, non-competition and non-solicitation covenants for the 18-month period following his employment with CVS Health. The Board appointed Mr. Cowhey to serve as CVS Health’s Executive Vice President and Chief Financial Officer, effective January 5, 2024.

  89. Samrat S. Khichi

    Samrat S. Khichi Mr. Khichi joined the Company in February 2023. In accordance with his offer letter, Mr. Khichi’s base salary is $850,000 and his annual cash incentive target is 100% of his annual base salary. In addition, Mr. Khichi’s target annual equity award compensation is $4.5 million. Upon hire, Mr. Khichi received make-whole awards in the form of cash and restricted stock units representing the economic equivalent of the cash and equity that he was required to forfeit from his prior employer. This included a one-time $2 million cash payment (the “Cash Payment”) and a one-time make-whole equity award with a grant date value of $4.0 million (the “Make-Whole Equity Award”), which will vest ratably on the first, second and third anniversaries of the grant date, subject to the terms of the underlying award agreement. Mr. Khichi will be required to fully repay the Cash Payment if CVS Health terminates his employment for cause or if Mr. Khichi voluntarily terminates his employment prior to 24 months of his hire date. If Mr. Khichi voluntarily terminates his employment, or if his employment is terminated by CVS Health for cause, prior to the vesting dates of the Make-Whole Equity Award, the Award will be forfeited upon his termination of employment. If the Company involuntarily terminates his employment not for cause, the Make-Whole Equity Award will continue to vest through the duration of the severance period (18 months post-termination). Mr. Khichi also entered into CVS Health’s customary CIC Agreement for executives and a restrictive covenant agreement which includes, among other things, non-competition and non-solicitation covenants for the 18-month period following his employment with CVS Health.

  90. CIC Agreements with NEOs

    CIC Agreements with NEOs The MP&D Committee believes that the interests of stockholders are best served by ensuring that the interests of our senior management are aligned with our stockholders. The CIC Agreements with our NEOs, other than Ms. Lynch, are intended to eliminate, or at least reduce, the reluctance of senior management to pursue potential change in control transactions that may be in stockholders’ best interests. The CIC Agreements serve to eliminate distraction caused by uncertainty about personal financial circumstances during a period in which CVS Health requires focused and thoughtful leadership to ensure a successful outcome. Accordingly, the CIC Agreements provide certain specified “double trigger” severance benefits to the covered executives in the event of their termination under certain circumstances following a change in control. The MP&D Committee believes a “double trigger” severance benefit provision is more appropriate, as it provides an incentive for greater continuity in management following a change in control. “Double trigger” benefits require that two events occur in order for severance to be paid, typically a change in control of the Company followed by the executive’s involuntary termination of employment. The 2010 or 2017 Incentive Compensation Plans (“ICPs”) that govern the terms of outstanding equity awards to all NEOs also require a “double trigger” for vesting of equity change in control benefits. The MP&D Committee reviews these potential severance benefits annually with the assistance of its independent compensation consultant to evaluate both their effectiveness and competitiveness. The review for fiscal year 2023 found the current level of benefits to be within competitive norms for design. Details of payments made to the executives upon a change in control and various termination scenarios; provisions for the treatment of equity awards, and other benefits; and estimated payments that would be made to the executives whose employment terminates following a change in control may be found in Payments/(Forfeitures) Under Termination Scenarios beginning on page 87.

  91. Policy on Forfeiture and Recoupment of Incentive Compensation

    | | Who | When | What | | Misconduct Cancellation/Forfeiture | • Applies to all colleagues who receive equity-based awards as part of their incentive compensation | • A colleague is terminated for “Cause”: • willfully and materially breaches any of his or her obligations to the Company with respect to confidentiality, cooperation with regard to litigation, non-disparagement and non-solicitation; • is convicted of a felony involving moral turpitude; or • engages in conduct that constitutes willful gross neglect or willful gross misconduct in carrying out his or her duties to the Company, resulting, in either case, in material harm to the financial condition or reputation of the Company. | • All unvested equity awards will be cancelled/forfeited. | | Detrimental Conduct | • Applies to all colleagues who receive PSU awards as part of their incentive compensation | • Detrimental Conduct. During any period in which PSUs (and any related dividend equivalents) remain outstanding and payable, including the holding period, a participant may not engage in Detrimental Conduct. “Detrimental Conduct” means any one of the following: • any conduct that would constitute Cause; • the commission of a criminal act by the participant, whether or not performed in the workplace, that subjects, or if generally known, would subject the Company or its subsidiaries to public ridicule or embarrassment; • intentional misconduct or conduct not taken in good faith and causing significant reputational harm to the Company or its subsidiaries; • intentional violation, or negligent disregard, of the Company’s or its subsidiaries’ policies, rules and procedures, specifically including, but not limited to any of the participant’s obligations under the Company’s Code of Conduct and workplace policies; or • any violation of the participant’s restrictive covenant agreement. | • Payment of PSUs is specifically conditioned on the requirement that at all times prior to the settlement date, the participant does not engage in Detrimental Conduct. • Releasing shares delivered after the holding period is also specifically conditioned on the requirement that at all times prior to such release, the participant does not engage in Detrimental Conduct. • If the MP&D Committee determines in its reasonable business judgment that the participant has failed to satisfy such requirements, then all or a portion of the PSUs, or all or a portion of any shares delivered in settlement thereof that are subject to the holding period, as of the date of such determination, shall be cancelled and forfeited as of such date of determination. All such determinations by the MP&D Committee will be final and binding. |

  92. Policy on Forfeiture and Recoupment of Incentive Compensation

    | | Who | When | What | | Incentive Compensation Recoupment Policy | • Applies to all of our colleagues who receive annual cash incentive or long-term incentive awards, including equity-based awards | • When fraud or material financial misconduct by an employee meaningfully alters financial or operational results used to determine an award amount, as determined by our Board. • Applies to fraud or material financial misconduct committed during the performance period for the award amount that is discovered during the performance period or the three-year period following the performance period. | • Applies to all annual and long-term incentive awards. • Allows for recoupment of the entire award, not only excess amounts generated by the executive officer’s fraud or material financial misconduct. • Amended in March 2019 to require public disclosure of the circumstances of any recoupment from any executive officer (to the extent doing so would not violate any law or contractual obligations). | | Compliance with Restrictive Covenant Agreement | • All colleagues receiving equity awards | • A colleague breaches the terms of their Restrictive Covenant Agreement | • The Company may recover profits from RSUs, PSUs and stock options that vested in the two-year period prior to the breach. | | Dodd-Frank Clawback Policy | • Current or former Section 16 Officers (“Covered Individuals”) regardless of fault | • Company required to prepare a Qualifying Restatement as defined in the Dodd-Frank Clawback Policy | • Provides for the recovery compensation that is incentive-based, erroneously awarded and received by the officer within the three (3) years preceding the date that the restatement was needed; prohibits actual or de facto indemnification; and is publicly disclosed. |

  93. Cash Severance Policy

    Cash Severance Policy The MP&D Committee adopted an executive severance policy, effective for 2024, which provides that the Company will not enter into any new employee agreement, severance agreement or separation agreement or establish any new severance plan or policy providing for cash severance to our Section 16 officers (including our NEOs) exceeding 2.99 times the sum of base salary and target bonus without stockholder approval. Since 2010, the severance plan covering executives (other than Ms. Lynch) has provided, and continues to provide, cash severance of 1.5 times base salary and the Change In Control Agreements provide for 1.5 times base salary plus target bonus. Ms. Lynch’s employment agreement provides cash severance that does not exceed 2.5 times base salary plus target bonus. The CVS Health Corporation Executive Officer Cash Severance Policy is available on our website: https://investors.cvshealth.com under “Governance Documents.”

  94. Insider Trading Policy; Anti-Pledging and Anti-Hedging Policy

    | • | Trading in our securities on a short-term basis (stock purchased in the open market must be held for at least six months); | | • | Purchasing stock on margin or pledging our stock or any stock incentive award as collateral for a loan or margin account; | | • | Engaging in short sales of our stock; | | • | Buying or selling puts, calls, exchange traded options or other derivative securities based on our stock; or | | • | Engaging in any other hedging transactions with respect to our stock, which includes transactions designed to offset any decrease in the market value of equity securities. |

  95. Non-GAAP Financial Measures Used In Compensation Discussion and Analysis

    | Adjusted EPS Adjusted EPS is calculated by dividing adjusted income attributable to CVS Health by the Company’s weighted average diluted shares outstanding. The Company defines adjusted income attributable to CVS Health as net income attributable to CVS Health (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, such as acquisition-related transaction and integration costs, restructuring charges, office real estate optimization charges, losses on assets held for sale, opioid litigation charges, gains/losses on divestitures as well as the corresponding income tax benefit or expense related to the items excluded from adjusted income attributable to CVS Health. Adjusted Operating Income Adjusted Operating Income is defined as operating income (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, such as acquisition-related transaction and integration costs, restructuring charges, office real estate optimization charges, losses on assets held for sale, opioid litigation charges and gains/losses on divestitures. 2023 MIP Adjusted Operating Income The Company uses MIP Adjusted Operating Income as a measure in the MIP. The Company defines MIP Adjusted Operating Income as operating income (GAAP measure) excluding the impact of amortization of intangible assets and net realized capital gains or losses, and other items, if any, that neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, such as acquisition-related transaction and integration costs, restructuring charges, office real estate optimization charges, losses on assets held for sale and net operating results associated with acquired businesses. 2023 PSU Adjusted EPS PSU Adjusted EPS is calculated by dividing PSU adjusted income attributable to CVS Health by the Company’s weighted average diluted shares outstanding. The Company defines PSU adjusted income attributable to CVS Health as net income from attributable to CVS Health (GAAP measure) excluding the impact of amortization of intangible assets and other items, if any, that neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, such as acquisition-related transaction and integration costs, restructuring charges, office real estate optimization charges, losses on assets held for sale, net realized capital gains or losses in excess of $100 million, the dilutive impact of acquired businesses and the corresponding income tax benefit or expense related to the items excluded from PSU adjusted income attributable to CVS Health. |

  96. Relative TSR Peer Group for 2023-2025 PSU Awards

    Relative TSR Peer Group for 2023-2025 PSU Awards

  97. Summary Compensation Table

    Summary Compensation Table The following Summary Compensation Table shows information about the compensation received by our CEO, our current and former CFOs, and each of our three other most highly compensated executive officers for services rendered in all capacities during the 2023 fiscal year and the applicable comparable data for the 2022 and 2021 fiscal years.

  98. Summary Compensation Table

    | Name & Principal 2023 Positions(1) | Year | Salary ($)(2) | Bonus ($) | Stock Awards ($)(4) | Option Awards ($)(5) | Non-Equity Incentive Plan Compensation ($)(6) | Change In Pension Value and Nonqualified Deferred Compensation Earnings ($)(7) | All Other Compensation ($)(8) | Total ($) | | Karen S. Lynch President and Chief Executive Officer | 2023 | 1,500,000 | — | 12,374,971 | 4,124,992 | 2,992,000 | — | 623,071 | 21,615,034 | | | 2022 | 1,487,500 | — | 12,374,946 | 4,124,984 | 2,975,000 | — | 354,625 | 21,317,055 | | | 2021 | 1,429,167 | — | 9,749,990 | 3,249,997 | 5,616,000 | — | 343,258 | 20,388,412 | | Thomas F. Cowhey Senior Vice President and Interim Chief Financial Officer | 2023 | 771,250 | — | 2,187,397 | 562,490 | 788,000 | 2,095 | 268,705 | 4,579,937 | | Samrat S. Khichi Executive Vice President, Chief Policy Officer and General Counsel | 2023 | 753,409 | 2,000,000(3) | 7,374,948 | 1,124,996 | 626,000 | — | 7,150 | 11,886,503 | | Tilak Mandadi Executive Vice President and Chief Digital, Data, Analytics and Technology Officer | 2023 | 1,000,000 | — | 4,874,990 | 1,624,993 | 1,246,000 | — | 135,862 | 8,881,845 | | | 2022 | 437,500 | 2,773,375 | 9,799,983 | — | 981,000 | — | 0 | 13,991,858 | | Prem S. Shah Executive Vice President, Chief Pharmacy Officer and President of Pharmacy & Consumer Wellness | 2023 | 950,000 | — | 4,499,937 | 1,499,989 | 1,421,000 | — | 211,440 | 8,582,366 | | | 2022 | 916,667 | — | 4,999,820 | 999,999 | 1,949,000 | — | 149,732 | 9,015,218 | | Shawn M. Guertin Former Executive Vice President, Chief Financial Officer and President of Health Services | 2023 | 989,583 | — | 7,499,980 | 2,499,999 | 1,439,000 | — | 65,572 | 12,494,134 | | | 2022 | 1,250,000 | — | 7,499,943 | 2,499,998 | 3,270,000 | — | 110,772 | 14,630,713 | | | 2021 | 738,636 | 1,000,000 | 8,249,980 | 1,749,999 | 2,585,000 | — | 15,615 | 14,339,230 |

  99. Summary Compensation Table

    | (1) Principal positions as of December 31, 2023. Effective October 13, 2023, Mr. Guertin, EVP, CFO and President, Health Services, began a personal leave of absence for unforeseen family medical reasons and Mr. Cowhey became Interim CFO. Subsequently, effective January 5, 2024, Mr. Cowhey became EVP and CFO when Mr. Guertin stepped down. Mr. Guertin and the Company did not enter into a separation agreement in connection with his decision to step down and he will not receive separation pay. Messrs. Cowhey and Khichi were not NEOs in 2022 or 2021. Messrs. Mandadi and Shah were not NEOs in 2021. | | (2) Amount of salary actually received in any year may differ from the annual base salary amount reported due to the timing of payroll periods and the timing of changes in base salary, which typically occur in April or following a promotion or hire during the year. | | (3) In connection with joining the Company, Mr. Khichi received the Cash Payment as part of his make-whole awards that replaced the value of the bonus, equity awards and other variable pay that Mr. Khichi forfeited from his prior employer when he accepted the position at CVS Health. See “Agreements with Named Executive Officers” on page 72. | | (4) Included in this column is the full grant date fair value of all RSU and PSU awards made to each NEO in the applicable year. The grant date fair value of each grant is computed in accordance with Financial Accounting Standards Board Accounting Standards Codification, Compensation – Stock Compensation, Topic 718 (“FASB ASC Topic 718”), excluding forfeiture estimates. The grant date fair values for PSU awards granted in 2023 are based upon the probable outcome of the performance conditions associated with these PSU awards as of the grant date and is calculated using a Monte Carlo simulation in accordance with FASB ASC Topic 718. Additional details regarding the grants of stock awards can be found in the Grants of Plan-Based Awards table. Each PSU represents one share of our common stock and upon vesting, will settle in shares, if earned, of CVS Health common stock, net of applicable withholding taxes, and subject to a two-year post-vesting holding period. Vesting of the PSU awards granted to the applicable NEOs on April 1, 2023 will occur, if at all, on April 1, 2026, and full vesting generally is subject to continued employment of the applicable NEO through April 1, 2026. In addition, included for Mr. Cowhey is the grant date fair value of his annual RSU award, which he received in his prior role as SVP, Capital Markets on April 1, 2023 and will vest in equal installments on the first, second, and third anniversaries of the grant date. Also included for Mr. Cowhey is the grant date fair value of an RSU award that he received on November 30, 2023 in connection with his appointment as Interim CFO and which cliff vests November 30, 2026. Also included for Mr. Khichi is the grant date fair value of the Make-Whole Equity Award that he received on February 28, 2023, pursuant to his letter agreement and which vests in three equal installments beginning on February 28, 2024. The grant date fair value of the PSU awards granted to the NEOs in 2023, assuming the highest level of performance conditions associated with these PSUs occurs (capped at 200% of target) is as follows: |

  100. Summary Compensation Table

    | Name | Grant Date | Grant Date Fair Value Assuming Highest Level of Performance Conditions Achieved(a) ($) | | Karen S. Lynch | April 1, 2023 | 24,749,942 | | Thomas F. Cowhey | April 1, 2023 | 2,249,937 | | Samrat S. Khichi | April 1, 2023 | 6,749,938 | | Tilak Mandadi | April 1, 2023 | 9,749,981 | | Prem S. Shah | April 1, 2023 | 8,999,875 | | Shawn M. Guertin | April 1, 2023 | 14,999,961 |

  101. Summary Compensation Table

    | (a) The maximum PSU payout for the 2023 PSU awards is 200%. |

  102. Summary Compensation Table

    | (5) The amounts reported in the Option Awards column represent the grant date fair value of stock option awards granted to each of the applicable NEOs on April 1, 2023, calculated in accordance with FASB ASC Topic 718. These options have an exercise price of $74.31 (the closing price of our common stock on April 1, 2023) and will vest in equal installments on the first, second, third and fourth anniversaries of the grant date and expire ten years from the grant date. The option values were calculated using a modified Black-Scholes Model for pricing options. Refer to our 2023 Annual Report, Notes to Consolidated Financial Statements at Note 13, “Stock Incentive Plans,” for all relevant valuation assumptions used to determine the grant date fair value of these options. Additional details regarding the grants of stock option awards can be found under “2023 Stock Option and PSU Awards” beginning on page 66 and in the Grants of Plan-Based Awards table. | | (6) The figures shown include amounts earned in 2023 as annual cash incentive awards (see pages 60-66). | | (7) Amounts in this column only reflect pension values and do not include earnings on deferred compensation amounts because such earnings are neither above-market nor preferential. Refer to the “Nonqualified Deferred Compensation” section on page 86 for a discussion of deferred compensation. The amount in the column presents the change in present value of accumulated benefits under the Retirement Plan for Employees of Aetna Inc. from December 31, 2022 through December 31, 2023 for Mr. Cowhey. See “Pension Benefits” beginning on page 85 for a discussion of pension benefits and the economic assumptions behind the figures in this table. No other NEOs participate in any defined benefit pension plan. | | (8) Set forth below is additional information regarding the amounts disclosed in the “All Other Compensation” column for 2023. |

  103. Grants of Plan-Based Awards

    Grants of Plan-Based Awards This table reflects awards granted during 2023 to our Named Executive Officers under the 2017 Incentive Compensation Plan of CVS Health Corporation, as amended (the “2017 ICP”), in the respective amounts listed. The MP&D Committee approved all of the 2023 awards.

  104. Grants of Plan-Based Awards – 2023

    Grants of Plan-Based Awards – 2023

  105. Grants of Plan-Based Awards – 2023

    | | | | | Est. Future Payouts Under Non- Equity Incentive Plan Awards(2) | | | Est. Future Payouts Under Equity Incentive Plan Awards(3) | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#)(4) | | Grant Date Fair Value of Stock and Option Awards ($)(5) | | Name | Award Type | Date of Committee Action(1) | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | Exercise or Base Price of Option Awards ($ / Sh)(4) | | | Karen S. Lynch | Stock Options(6) | 2/2/2023 | 4/1/2023 | | | | | | | | 244,952 | 74.31 | 4,124,992 | | | PSUs(7) | 2/2/2023 | 4/1/2023 | | | | 78,014 | 195,035 | 390,070 | | | | 12,374,971 | | | Annual Cash | | | 1,500,000 | 3,000,000 | 6,000,000 | — | — | — | | | | | | Thomas F. Cowhey | Stock Options(6) | 2/2/2023 | 4/1/2023 | | | | | | | | 33,402 | 74.31 | 562,490 | | | PSUs(7) | 2/2/2023 | 4/1/2023 | | | | 7,092 | 17,730 | 35,460 | | | | 1,124,969 | | | RSUs(8) | 2/2/2023 | 4/1/2023 | | | | | | | 7,569 | | | 562,452 | | | RSUs(9) | 10/11/2023 | 11/30/2023 | | | | | | | 7,358 | | | 499,976 | | | Annual Cash | | | 431,322 | 862,643(11) | 1,725,286 | — | — | — | | | | | | Samrat S. Khichi | Stock Options(6) | 12/22/2022 | 4/1/2023 | | | | | | | | 66,805 | 74.31 | 1,124,996 | | | PSUs(7) | 12/22/2022 | 4/1/2023 | | | | 21,276 | 53,191 | 106,382 | | | | 3,374,969 | | | RSUs(10) | 12/22/2022 | 2/28/2023 | | | | | | | 47,881 | | | 3,999,979 | | | Annual Cash | | | 376,705 | 753,409(12) | 1,506,818 | | | | | | | | | Tilak Mandadi | Stock Options(6) | 2/2/2023 | 4/1/2023 | | | | | | | | 96,496 | 74.31 | 1,624,993 | | | PSUs(7) | 2/2/2023 | 4/1/2023 | | | | 30,733 | 76,832 | 153,664 | | | | 4,874,990 | | | Annual Cash | | | 750,000 | 1,500,000 | 3,000,000 | — | — | — | | | | | | Prem S. Shah | Stock Options(6) | 2/2/2023 | 4/1/2023 | | | | | | | | 89,073 | 74.31 | 1,499,989 | | | PSUs(7) | 2/2/2023 | 4/1/2023 | | | | 28,368 | 70,921 | 141,842 | | | | 4,499,937 | | | Annual Cash | | | 712,500 | 1,425,000 | 2,850,000 | — | — | — | | | | | | Shawn M. Guertin | Stock Options(6) | 2/2/2023 | 4/1/2023 | | | | | | | | 148,456 | 74.31 | 2,499,999 | | | PSUs(7) | 2/2/2023 | 4/1/2023 | | | | 47,281 | 118,203 | 236,406 | | | | 7,499,980 | | | Annual Cash | | | 865,885 | 1,731,770(13) | 3,463,540 | — | — | — | | | | |

  106. Grants of Plan-Based Awards – 2023

    | (1) Represents the date the MP&D Committee approved the 2023 grant values for stock options, PSU and RSU awards. Refer to “2023 Stock Option and PSU Awards” beginning on page 66 for a detailed discussion of the PSU awards. | | (2) Represents the threshold, target and maximum payout levels of target annual cash incentive award granted under the 2023 MIP. Performance below the threshold results in no payout. See “Annual Cash Incentive” beginning on page 60 for a discussion of the 2023 MIP metrics and payouts. | | (3) Represents the threshold, target and maximum achievement in order to receive a payout for the applicable award. Performance below the threshold results in no payout. Refer to “2023 Stock Option and PSU Awards” beginning on page 66 for a detailed discussion. | | (4) All options were granted with an exercise price equal to the closing price of our common stock on the date of the grant. Included in this column is the full grant date fair value of the options granted to all of the NEOs on April 1, 2023. The option values are calculated using a modified Black-Scholes Model for pricing options. |

  107. Grants of Plan-Based Awards – 2023

    | (5) Refer to our 2023 Annual Report, Notes to Consolidated Financial Statements at Note 13, “Stock Incentive Plans” for all relevant valuation assumptions for all grants. Included in this column is the full grant date fair value of the PSUs and options granted to all of the NEOs on April 1, 2023. Also includes grant date fair value of RSU awards granted to Mr. Khichi on February 28, 2023 and to Mr. Cowhey on April 1, 2023 and November 30, 2023, respectively. See footnotes 4 and 6 of the SCT for additional details. | | (6) Represents stock options granted under the 2017 ICP in the respective amounts and on the respective dates listed. These stock options vest on the first, second, third and fourth anniversaries of the grant date and expire ten years from the grant date. | | (7) Represents PSU awards granted under the 2017 ICP in the respective amounts and on the respective dates listed. For the 2023-2025 cycle, these PSU awards are included in the SCT in the “Stock Awards” column. The PSU award, if earned, is based on the Company’s 2025 Adjusted EPS and will be modified by up to +/- 25% based on CVS Health’s performance as measured by rTSR. The maximum PSU payout for the 2023 PSU awards under “Est. Future Payouts Under Equity Incentive Plan Awards” is 200%, even with the maximum rTSR modifier of +25%. Each vested PSU represents one share of CVS Health common stock and will settle in shares, if earned, of CVS Health common stock, net of taxes, as a result of a determination by the MP&D Committee. The PSU awards do not earn dividend equivalents and have no voting rights. See the discussion of long-term incentive equity awards under “2023 Stock Option and PSU Awards” beginning on page 66 for a discussion of the vesting and payout of these awards based on the MP&D Committee’s determination that the Company has achieved the applicable performance result. Refer to footnote 4 of the SCT beginning on page 79 for a discussion of how the number of vested PSUs will be determined. | | (8) Represents annual RSUs granted to Mr. Cowhey under the 2017 ICP. These RSUs vest in four substantially equal installments beginning on April 1, 2024. | | (9) Represents RSUs granted to Mr. Cowhey under the 2017 ICP after he assumed the role of Interim CFO in October 2023. These RSUs cliff vest on the third anniversary of the grant date. | | (10) Represents the Make-Whole Equity Award granted to Mr. Khichi under the 2017 ICP. These RSUs vest in three substantially equal installments beginning on February 28, 2024. See “Agreements with Named Executive Officers” on page 72. | | (11) Mr. Cowhey’s 2023 annual target bonus opportunity is pro-rated to reflect his appointment as Interim CFO in October 2023 and his 2023 target bonus opportunity is 150% of base salary during the interim period and 100% of target in the prior period. | | (12) Mr. Khichi’s 2023 annual target bonus opportunity is pro-rated to reflect his date of hire in February 2023; his 2023 full-year target bonus opportunity is 100% of base salary. | | (13) Mr. Guertin’s 2023 annual target bonus opportunity is pro-rated to reflect his personal leave of absence beginning in October 2023; his 2023 full-year target bonus opportunity is 175% of base salary. |

  108. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End This table shows information regarding the outstanding equity awards held by each of our Named Executive Officers under the applicable plan that were outstanding as of December 31, 2023. The unearned PSU awards granted in 2023 and 2022 are shown at target performance, with no adjustment for the rTSR modifier performance. The 2021 PSUs are shown at actual performance with an adjustment for rTSR modifier performance, as explained in the footnotes below.

  109. Outstanding Equity Awards at 2023 Year-End

    Outstanding Equity Awards at 2023 Year-End

  110. Outstanding Equity Awards at 2023 Year-End

    | | | Stock Option Awards(1) | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares or Units of Stock that Have Not Vested (#) | Equity Incentive Plan Awards: Market Value of Unearned Shares or Units of Stock that Have Not Vested ($)(2) | | Karen S. Lynch | 2/19/2016 | 93,989 | —(3) | 37.91 | 2/18/2026 | | | | | | | 2/17/2017 | 192,741 | —(3) | 45.91 | 2/16/2027 | | | | | | | 4/1/2019 | 242,408 | —(4) | 54.19 | 4/1/2029 | | | | | | | 4/1/2020 | 158,397 | 52,799(4) | 58.34 | 4/1/2030 | | | | | | | 4/1/2021 | 112,302 | 112,302(4) | 74.30 | 4/1/2031 | 136,640(8) | 10,789,094 | | | | | 4/1/2022 | 42,879 | 128,638(4) | 101.09 | 4/1/2032 | | | 121,645(16) | 9,605,089 | | | 4/1/2023 | — | 244,952(4) | 74.31 | 4/1/2033 | | | 195,035(17) | 15,399,964 | | Thomas F. Cowhey | 2/28/2022 | | | | | 38,592(9) | 3,047,224 | | | | | 4/1/2022 | 5,197 | 15,593(4) | 101.09 | 4/1/2032 | 7,419(10) | 585,804 | 4,914(16) | 388,009 | | | 4/1/2023 | — | 33,402(4) | 74.31 | 4/1/2033 | 7,569(10) | 597,648 | 17,730(17) | 1,399,961 | | | 11/30/2023 | | | | | 7,358(11) | 580,988 | | | | Samrat S. Khichi | 2/28/2023 | | | | | 47,881(12) | 3,780,684 | | | | | 4/1/2023 | — | 66,805(4) | 74.31 | 4/1/2033 | | | 53,191(17) | 4,199,961 | | Tilak Mandadi | 8/31/2022 | | | | | 66,565(13) | 5,255,972 | | | | | 4/1/2023 | — | 96,496(4) | 74.31 | 4/1/2033 | | | 76,832(17) | 6,066,655 | | Prem S. Shah | 4/1/2018 | 846 | —(5) | 62.21 | 4/1/2025 | | | | | | | 8/31/2018 | 26,580 | —(6) | 75.24 | 8/31/2028 | | | | | | | 4/1/2019 | 9,469 | —(4) | 54.19 | 4/1/2029 | | | | | | | 4/1/2020 | 17,157 | 11,439(4) | 58.34 | 4/1/2030 | 5,143(10) | 406,091 | | | | | 2/26/2021 | | | | | 933(9) | 73,670 | | | | | 4/1/2021 | 12,309 | 16,414(4) | 74.30 | 4/1/2031 | 16,510(14) | 1,303,630 | | | | | 4/1/2022 | 10,395 | 31,185(4) | 101.09 | 4/1/2032 | | | 29,489(16) | 2,328,451 | | | 8/31/2022 | | | | | 20,376(11) | 1,608,889 | | | | | 4/1/2023 | — | 89,073(4) | 74.31 | 4/1/2033 | | | 70,921(17) | 5,599,922 | | Shawn M. Guertin | 5/28/2021 | 48,780 | 48,782(7) | 86.44 | 5/28/2031 | 94,710(15) | 7,478,302 | | | | | 4/1/2022 | 25,987 | 77,963(4) | 101.09 | 4/1/2032 | | | 73,724(16) | 5,821,247 | | | 4/1/2023 | — | 148,456(4) | 74.31 | 4/1/2033 | | | 118,203(17) | 9,333,309 |

  111. Outstanding Equity Awards at 2023 Year-End

    | (1) The Company had no equity incentive plan awards that were securities underlying unexercised, unearned options at fiscal year-end, so that column is intentionally omitted from this table. | | (2) The value of the RSUs and PSUs is based on a price of $78.96 per share, which was the closing price of the Company’s common stock on December 29, 2023, the last trading day of the Company’s fiscal year. Each vested RSU and PSU represents one share of Company’s common stock and will settle in shares, if earned (for PSUs), of Company common stock, net of taxes. | | (3) Represents stock appreciation rights (“SARs”) that were granted prior to the Aetna Transaction and expire ten years from the date of grant. |

  112. Outstanding Equity Awards at 2023 Year-End

    | (4) These stock options vest in one-quarter increments on each of the first, second, third and fourth anniversaries of the grant date and expire ten years from the date of the grant. | | (5) These stock options vest in one-quarter increments on each of the first, second, third and fourth anniversaries of the grant date and expire seven years from the date of the grant. | | (6) These stock options vest in one-third increments on each of the third, fourth, and fifth anniversaries of the grant date and expire ten years from the date of the grant. | | (7) Represents stock options granted to Mr. Guertin at the time of hire and vest in one-quarter increments on each of the first, second, third and fourth anniversaries of the grant date and expire ten years from the date of the grant. | | (8) Represents PSUs granted on April 1, 2021 that vested on April 1, 2024 and depended upon the attainment of specified performance goals over a period beginning on January 1, 2021 and ending on December 31, 2023. As of December 31, 2023, actual performance with respect to the 2021 PSUs were above target performance levels and therefore the number of shares reported are based on the actual number of shares underlying the 2021 PSUs that were earned at the end of the three-year performance period. The calculated performance of the 2021 PSUs was 103.3% after applying the rTSR modifier. Please see “Prior PSU Performance Programs” beginning on page 68 for a discussion of the MP&D Committee’s determination that the Company surpassed the applicable performance metrics and applied the rTSR modifier. | | (9) Represents RSUs that vest in three substantially equal installments beginning on the first anniversary of the grant date. | | (10) Represents RSUs that vest in substantially equal installments on the first, second, third and fourth anniversaries of the grant date. | | (11) Includes RSUs that cliff vest on the third anniversary of the grant date. | | (12) Make-Whole Equity Award vests in three substantially equal installments beginning on the first anniversary of the grant date. | | (13) Sign-on RSUs vest in three substantially equal installments beginning on the first anniversary of the grant date. | | (14) Represents a) 3,197 RSUs that cliff vest on the third anniversary of the grant date and b) PSUs granted to Mr. Shah granted in April 1, 2021 that vested on April 1, 2024 and depended upon the attainment of specified performance goals over a period beginning on January 1, 2021 and ending on December 31, 2023. As of December 31, 2023, actual performance with respect to the 2021 PSUs were above target performance levels and therefore the number of shares reported are based on the actual number of shares underlying the 2021 PSUs that were earned at the end of the three-year performance period. The calculated performance of the 2021 PSUs was 103.3% after applying the rTSR modifier resulting in 13,313 PSUs. Please see “Prior PSU Performance Programs” beginning on page 68 for a discussion of the MP&D Committee’s determination that the Company surpassed the applicable performance metrics and applied the rTSR modifier. | | (15) Represents a) 34,706 RSUs that cliff vest on the third anniversary of the grant date and b) PSUs granted to Mr. Guertin at the time of hire that vested on April 1, 2024 and depended upon the attainment of specified performance goals over a period beginning on January 1, 2021 and ending on December 31, 2023. As of December 31, 2023, actual performance with respect to the 2021 PSUs were above target performance levels and therefore the number of shares reported are based on the actual number of shares underlying the 2021 PSUs that were earned at the end of the three-year performance period. The calculated performance of the 2021 PSUs was 103.3% after applying the rTSR modifier resulting in 60,004 PSUs. Please see “Prior PSU Performance Programs” beginning on page 68 for a discussion of the MP&D Committee’s determination that the Company surpassed the applicable performance metrics and applied the rTSR modifier. | | (16) Represents PSU awards granted on April 1, 2022, which may vest on April 1, 2025. The performance period for these PSUs is January 1, 2022 to December 31, 2024. | | (17) Represents PSU awards granted on April 1, 2023, which may vest on April 1, 2026. The performance period for these PSUs is January 1, 2023 to December 31, 2025. |

  113. Option Exercises and Stock Vested

    Option Exercises and Stock Vested The table below reflects information for the fiscal year ended December 31, 2023 concerning options exercised and the vesting of previously granted RSUs and PSUs and non-transferable shares for each of the NEOs specified in the table. The value of the shares acquired upon exercise of the options and the shares represented by the vesting of RSUs and PSUs is based on the closing price of our common stock on the date of exercise and the date of vesting, respectively.

  114. Option Exercises and Stock Vested – 2023

    Option Exercises and Stock Vested – 2023

  115. Option Exercises and Stock Vested – 2023

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(1) | | Karen S. Lynch | 0 | 0 | 206,610 | 15,353,189 | | Thomas F. Cowhey | 0 | 0 | 21,768 | 1,795,673 | | Samrat S. Khichi | 0 | 0 | 0 | 0 | | Tilak Mandadi | 0 | 0 | 33,282 | 2,168,988 | | Prem S. Shah | 0 | 0 | 18,052 | 1,288,142 | | Shawn M. Guertin | 0 | 0 | 0 | 0 |

  116. Option Exercises and Stock Vested – 2023

    | (1) Includes the RSU value deferred by Mr. Shah during 2023, which is also included in the “Stock” row of the “Executive Contributions in Last FY” column of the Nonqualified Deferred Compensation table on page 86. |

  117. Pension Benefits

    Pension Benefits Aetna Inc. maintained a tax-qualified frozen defined benefit pension plan, the Retirement Plan for Employees of Aetna Inc. (the “Aetna Pension Plan”), at the time it was acquired by the Company. Mr. Cowhey was a participant in the Aetna Pension Plan from 2007 until it was frozen in 2010 and he has a deferred vested benefit under the Aetna Pension Plan that has continued to accrue interest. No other NEOs participate in any defined benefit pension plan. The following table sets forth information concerning the present value of Mr. Cowhey’s accumulated benefits under the Aetna Pension Plan. The present value shown below was determined based on Mr. Cowhey’s accrued benefit as of December 31, 2023, the discount rates that the Aetna Pension Plan used for its 2023 year-end pension disclosures and assumes Mr. Cowhey’s continued employment to age 65.

  118. Pension Benefits

    | Name | Plan Name | Number of Years Credited Service (#)(1) | Present Value of Accumulated Benefit ($)(2) | | Karen S. Lynch | N/A | N/A | N/A | | Thomas F. Cowhey | Retirement Plan for Employees of Aetna Inc. | 3.8 | $23,782 | | Samrat S. Khichi | N/A | N/A | N/A | | Tilak Mandadi | N/A | N/A | N/A | | Prem S. Shah | N/A | N/A | N/A | | Shawn M. Guertin | N/A | N/A | N/A |

  119. Pension Benefits

    | (1) Mr. Cowhey’s credited years of service is limited to the time of his hire at Aetna in March 2007 to December 31, 2010, when the Aetna Pension Plan was frozen, so the years of credited service does not increase even though his actual term of service is longer. | | (2) Refer to pages 169-174 of the 2023 Annual Report for a discussion of the valuation methods used to calculate the amounts in this column. In calculating the present value of the accumulated benefit under the Aetna Pension Plan, the following economic assumptions were used: |

  120. Pension Benefits

    | | Pension Plan | | Discount Rate | 4.97% | | Future Cash Balance Interest Rate | 4.03% | | 5-Year Average Cost of Living Adjustment | 2.30% |

  121. Nonqualified Deferred Compensation

    Nonqualified Deferred Compensation Executive officers and select members of management may participate in the DCP and the DSP. The DCP allows participants to defer payment of a portion of their salary and a portion of their annual cash incentive to facilitate their personal retirement or financial planning. For participants in the DCP, we provide a maximum match of up to 5% of the eligible compensation (base+bonus) that exceeds the IRS earnings limit that applies to 401(k) plans after completion of one year of service. The investment crediting options for the DCP mirror those offered for the 401(k) Plan. Each year, the amount of a participant’s deferred compensation account increases or decreases based on the appreciation and/or depreciation in the value of the investment crediting alternatives selected by the participant. There are no vesting requirements on deferred compensation accounts. Under the DSP, participants may elect to defer settlement of RSUs and PSUs beyond the scheduled vesting date. Following vesting, dividends are reinvested during the deferral period. During 2023, Mr. Shah deferred portions of his equity-based compensation under the DSP. Executive officers are not permitted to defer proceeds of stock option exercises. The amounts shown in the table below for “Cash” and “Stock” were deferred pursuant to the DCP and the DSP, respectively.

  122. Nonqualified Deferred Compensation – 2023

    Nonqualified Deferred Compensation – 2023

  123. Nonqualified Deferred Compensation – 2023

    | Name | Type | Executive Contributions in Last FY ($)(1) | Registrant Contributions in Last FY ($)(2) | Aggregate Earnings in Last FY ($)(3) | Aggregate Withdrawals/ Distributions ($)(4) | Aggregate Balance at Last FYE ($)(5) | | Karen S. Lynch | Cash | 223,750 | 207,250 | 111,576 | — | 1,504,880 | | | Stock | — | — | — | — | — | | Thomas F. Cowhey | Cash | — | — | — | — | — | | | Stock | — | — | — | — | — | | Samrat S. Khichi | Cash | — | — | — | — | — | | | Stock | — | — | — | — | — | | Tilak Mandadi | Cash | 50,000 | 50,000 | 3,525 | — | 103,525 | | | Stock | — | — | — | — | — | | Prem S. Shah | Cash | 729,650 | 128,450 | (71,790) | (101,017) | 2,353,499 | | | Stock | 80,449 | — | (28,842) | — | 262,185 | | Shawn M. Guertin | Cash | — | — | — | — | — | | | Stock | — | — | — | — | — |

  124. Nonqualified Deferred Compensation – 2023

    | (1) The stock contribution for Mr. Shah includes the deferred settlement under the DSP of Performance Based Restricted Stock units granted in 2020 for performance year 2019 that vested in 2023. | | (2) All amounts shown are also disclosed in the SCT under All Other Compensation and reflect amounts credited and/or earned in 2023. | | (3) All earnings shown on the Stock line are attributable to dividend equivalents credited as additional deferred RSUs and the change in our common stock price since December 31, 2022. | | (4) All amounts reported are distributions of cash dividend equivalent payments from the DSP. | | (5) The following amounts included in this column have been previously reported as compensation to the NEOs in the SCTs of our prior proxy statements: |

  125. Nonqualified Deferred Compensation – 2023

    | | Cash | Stock | | Ms. Lynch | $291,666 | $ — | | Mr. Cowhey | — | — | | Mr. Khichi | — | — | | Mr. Mandadi | — | — | | Mr. Shah | 503,783 | 99,711 | | Mr. Guertin | — | — |

  126. Benefits and Payments upon Qualified Retirement or Voluntary Termination

    led or forfeited, including unvested equity grants and cash incentive awards. Benefits and Payments upon Qualified Retirement or Voluntary Termination In the event of voluntary termination, all unvested equity awards would be canceled unless the employee is eligible for “Qualified Retirement” treatment. “Qualified Retirement” means a termination of employment on or after attainment of age 55 with at least 10 years of continuous service, or attainment of age 60 with at least five years of continuous service, provided that if the NEO has options, PSUs and/or RSUs, he or she has provided the Company with at least 90 days advance notice of his or her retirement date. An NEO will also be deemed to have experienced a Qualified Retirement if the Company elects to terminate his or her employment without Cause and he or she has met the age and service requirements set forth above prior to or during the severance period set forth in a severance agreement with the Company. For purposes of this termination scenario in this disclosure, we have assumed that if a NEO has met the age and years of continuous service requirements for Qualified Retirement treatment as of December 31, 2023, he or she has also met the advance notice requirement for Qualified Retirement treatment. In the event an NEO’s employment with the Company terminates by reason of a deemed Qualified Ret

  127. Benefits and Payments upon Qualified Retirement or Voluntary Termination

    ement, outstanding equity awards held by the NEO would be treated as follows: | • | Unvested options would continue to vest during a three-year post-termination period. | | • | RSUs would vest on a pro-rata basis as of the NEO’s termination of employment date. | | • | PSUs would vest on a pro-rata basi

  128. Benefits and Payments upon Qualified Retirement or Voluntary Termination

    as of the NEO’s termination of employment date based on actual performance. | Based on age and tenure with the Company as of December 31, 2023, Messrs. Cowhey, Khichi, Mandadi, Shah and Guertin were not retirement eligible as of December 31, 2023. Pursuant to her Employment Agreement, Ms. Lyn

  129. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause Prior to a Change in Control of the Company (“CIC”)

    Benefits and Payments upon Termination without Cause or Constructive Termination without Cause Prior to a Change in Control of the Company (“CIC”) The CVS Health Severance Plan for Non-Store Employees (the “Severance Plan”), which covers executives, including our NEOs (other than Ms. Lynch), was approved by the MP&D Committee as described under “Other Compensation Arrangements and Benefits” beginning on page 70. With respect to each of the NEOs (other than Ms. Lynch), in the event of a termination without Cause or constructive termination prior to a CIC, pursuant to an RCA and the Severance Plan, the NEOs would be eligible to receive up to 18 months of base salary as severance, paid in equal semi-monthly installments, provided that he or she executes a separation agreement with the Company and complies with post-employment restrictive covenants. Pursuant to Ms. Lynch’s Employment Agreement, upon a qualifying termination of employment, including a termination of employment for “Good Reason”, prior to a CIC, Ms. Lynch would be entitled to a cash severance payment equal to two times the sum of her highest base salary in effect during the six-month period immediately prior to the date of her termination of employment and her target annual bonus opportunity for the year of her termination of employment. Ms. Lynch would also be entitled to a pro-rated annual bonus for the year of her termination of employment and up to 18 months of continued health and benefit plan participation at the same benefit and cost sharing level at which Ms. Lynch and her eligible dependents were participating on the date of her termination of employment. Ms. Lynch’s severance benefits are subject to her execution of a release and compliance with post-employment restrictive covenants. “Good Reason” is defined in her Employment Agreement to mean the occurrence of one or more of the following without Ms. Lynch’s written consent: (a) a reduction by the Company of base salary or target annual bonus opportunity from the level then in effect, except in the event of a ratable reduction affecting all senior officers of the Company; (b) an assignment of any duties that are materially inconsistent with her duties and responsibilities or a material diminution of duties and responsibilities, in each case as such duties and responsibilities were in effect immediately following February 1, 2021; (c) any failure of a successor of the Company to assume and agree to perform the Company’s entire obligations under her Employment Agreement; (d) reporting to any person other than the Board; (e) removal of Ms. Lynch as President and Chief Executive Officer of the Company (other than in connection with a termination of employment for Cause); (f) any action or inaction by the Company that constitutes a material breach of the terms of her Employment Agreement; or (g) the Company’s failure to nominate and recommend Ms. Lynch for re-election to the Board. In the event of a NEO’s termination without Cause or constructive termination prior to a CIC, outstanding equity awards held by the NEO would be treated as follows:

  130. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause Prior to a Change in Control of the Company (“CIC”)

    | • | Unvested options held by Ms. Lynch will continue to vest during a three-year post-termination period, as they would be entitled to Qualified Retirement treatment under the terms of the awards. For Messrs. Cowhey, Khichi, Mandadi, Shah and Guertin, their unvested options would continue to vest through the end of the severance period as they are not currently retirement eligible. | | • | If the NEO is entitled to severance, unvested RSUs will continue to vest during the applicable severance period, other than for Mr. Guertin, as the RSU award will provide for full vesting, with settlement on the original vesting date. | | • | If the NEO is entitled to severance, PSUs would vest on a pro-rata basis as of the NEO’s termination of employment date. |

  131. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC Ms. Lynch’s Employment Agreement and the CIC Agreements with Messrs. Cowhey, Khichi, Mandadi, Shah and Guertin provide that upon a CIC and subsequent termination of employment, all outstanding unvested stock options will vest in full and restrictions will lapse on all RSUs and PSUs (at target achievement levels). In addition, each NEO (other than Ms. Lynch) would receive a cash severance payment equal to 1.5 times annual base salary, 1.5 times the then-current annual cash incentive at target and a pro-rated cash incentive bonus at target for the year of termination. Pursuant to Ms. Lynch’s Employment Agreement, upon a qualifying termination of employment within two years following a CIC, Ms. Lynch’s cash severance payment would increase to two-and-a-half times the sum of her highest base salary in effect during the six-month period immediately prior to the date of her termination of employment and her target annual bonus opportunity for the year of her termination of employment. Under their CIC Agreements and Ms. Lynch’s Employment Agreement, any severance benefits would be reduced to avoid the excise tax under Section 280G of the Code if that would give the NEO a better after-tax result. With respect to the tables below for all NEOs:

  132. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | • | The value of options is determined by multiplying the number of unvested options outstanding as of December 31, 2023 by the difference between the exercise price and $78.96, the closing price of our common stock on December 29, 2023, the last trading day of our fiscal year. Generally, the option grant agreements provide for the following post-termination exercise periods, but in no case will the post-termination exercise period be longer than the original option term: | | | | • | In the case of constructive termination without cause prior to a CIC, during the severance period and for 90 days thereafter; | | | • | In the case of constructive termination without cause after a CIC, during the remainder of the option term; | | | • | In the case of a voluntary termination, awards granted in 2017 and later include a 90-day post-termination option exercise period; options granted before 2017 expire immediately upon a voluntary termination; | | | • | In the case of termination for cause, generally there is no post-termination exercise period; and | | | • | In the case of Qualified Retirement, during a three-year post termination exercise period. | | • | The value of RSUs is determined by multiplying the number of unvested RSUs as of December 31, 2023 by $78.96, the closing price of our common stock on December 29, 2023, the last trading day of our fiscal year. | | | • | The value of unvested PSUs assumes (a) no proration for the 2021 PSUs, pro-rated amounts for the outstanding 2022 PSUs (two-thirds) and 2023 PSUs (one-third); (b) a share price of $78.96, the closing price of our common stock on December 29, 2023 the last trading day of our fiscal year; (c) all outstanding performance cycles are achieved and paid at target; and (d) no adjustment for the applicable rTSR modifier the 2021, 2022 PSU and 2023 PSUs. | |

  133. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Karen S. Lynch | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC or Good Reason ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 3,000,000 | 3,750,000 | | Bonus(2) | 3,000,000 | 0 | 3,000,000 | 9,000,000 | 10,500,000 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 2,751,070 | (2,751,070) | 2,466,313 | 2,466,313 | 2,751,070 | | Value of RSUs | — | — | — | — | — | | Value of PSUs | 35,449,487 | (35,449,487) | 21,981,043 | 21,981,043 | 35,449,487 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 32,120 | 32,120 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 41,200,557 | (38,200,557) | 27,447,356 | 36,479,476 | 52,482,677 |

  134. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Pursuant to her Employment Agreement, Ms. Lynch is treated as retirement eligible under the terms of her equity awards. Based on her age and tenure with the Company as of December 31, 2023, Ms. Lynch is also eligible for Qualified Retirement treatment under the Company’s MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Ms. Lynch’s base salary for the year ending December 31, 2023 and the applicable multiplier described above. |

  135. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Thomas F. Cowhey | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 1,275,000 | 1,275,000 | | Bonus(2) | 1,275,000 | 0 | 0 | 0 | 3,187,500 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 155,319 | (155,319) | 0 | 77,655 | 155,319 | | Value of RSUs | 4,811,664 | (4,811,664) | 0 | 3,736,545 | 4,811,664 | | Value of PSUs | 1,787,970 | (1,787,970) | 0 | 714,509 | 1,787,970 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 25,693 | 25,693 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 8,029,953 | (6,754,953) | 0 | 5,829,402 | 11,243,146 |

  136. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Based on his age and tenure with the Company as of December 31, 2023, Mr. Cowhey is not eligible for Qualified Retirement treatment under the Company’s equity program and MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Mr. Cowhey’s base salary for the year ending December 31, 2023, with no-proration and the applicable multiplier described above. |

  137. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Samrat S. Khichi | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 1,275,000 | 1,275,000 | | Bonus(2) | 850,000 | 0 | 0 | 0 | 2,125,000 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 310,643 | (310,643) | 0 | 155,319 | 310,643 | | Value of RSUs | 3,780,684 | (3,780,684) | 0 | 2,520,403 | 3,780,684 | | Value of PSUs | 4,199,961 | (4,199,961) | 0 | 1,283,258 | 4,199,961 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 23,252 | 23,252 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 9,141,288 | (8,291,288) | 0 | 5,257,232 | 11,714,540 |

  138. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Based on his age and tenure with the Company as of December 31, 2023, Mr. Khichi is not eligible for Qualified Retirement treatment under the Company’s equity program and MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Mr. Khichi’s base salary for the year ending December 31, 2023 and the applicable multiplier described above. |

  139. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Tilak Mandadi | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 1,500,000 | 1,500,000 | | Bonus(2) | 1,500,000 | 0 | 0 | 0 | 3,750,000 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 448,706 | (448,706) | 0 | 224,353 | 448,706 | | Value of RSUs | 5,255,972 | (5,255,972) | 0 | 2,627,947 | 5,255,972 | | Value of PSUs | 6,066,655 | (6,066,655) | 0 | 2,022,166 | 6,066,655 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 11,464 | 11,464 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 13,271,333 | (11,771,333) | 0 | 6,385,930 | 17,032,797 |

  140. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Based on his tenure with the Company as of December 31, 2023, Mr. Mandadi is not eligible for Qualified Retirement treatment under the Company’s equity program and MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Mr. Mandadi’s base salary for the year ending December 31, 2023 and the applicable multiplier described above. |

  141. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Prem S. Shah | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 1,425,000 | 1,425,000 | | Bonus(2) | 1,425,000 | 0 | 0 | 0 | 3,562,500 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 726,551 | (726,551) | 0 | 519,454 | 726,551 | | Value of RSUs | 2,341,085 | (2,341,085) | 0 | 732,196 | 2,341,085 | | Value of PSUs | 8,946,010 | (8,946,010) | 0 | 4,436,526 | 8,946,010 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 30,790 | 30,790 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 13,438,646 | (12,013,646) | 0 | 7,143,966 | 17,031,936 |

  142. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Based on his age as of December 31, 2023, Mr. Shah is not eligible for Qualified Retirement treatment under the Company’s equity program and MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Mr. Shah’s base salary for the year ending December 31, 2023 and the applicable multiplier described above. |

  143. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | Shawn M. Guertin | Death ($) | Termination for Cause ($) | Qualified Retirement(1) or Voluntary Termination ($) | Termination without Cause or Constructive Termination without Cause Prior to CIC ($) | Termination without Cause or Constructive Termination without Cause After CIC ($) | | Cash Severance Value | | | | | | | Base Salary | 0 | 0 | 0 | 1,875,000 | 1,875,000 | | Bonus(2) | 2,187,500 | 0 | 0 | 0 | 5,468,750 | | Vesting (Forfeiture) of Equity | | | | | | | Value of Options | 690,320 | (690,320) | 0 | 345,160 | 690,320 | | Value of RSUs | 2,740,386 | (2,740,386) | 0 | 2,740,386 | 2,740,386 | | Value of PSUs | 19,741,184 | (19,741,184) | 0 | 11,068,850 | 19,741,184 | | Benefits and Other | | | | | | | Health Insurance | 0 | 0 | 0 | 20,014 | 20,014 | | Aetna Pension Plan | — | — | — | — | — | | Excise Tax Gross-Up | — | — | — | — | — | | Total | 25,359,390 | (23,171,890) | 0 | 16,049,410 | 30,535,654 |

  144. Benefits and Payments upon Termination without Cause or Constructive Termination without Cause After CIC

    | (1) Based on his age and tenure with the Company as of December 31, 2023, Mr. Guertin is not eligible for Qualified Retirement treatment under the Company’s equity program and MIP. | | (2) Represents annual incentive cash bonus amount at target, calculated using Mr. Guertin’s base salary for the year ending December 31, 2023 and the applicable multiplier described above. |

  145. CEO Pay Ratio

    CEO Pay Ratio At CVS Health, we share a single, clear purpose: bringing our heart to every moment of your health. We devote significant time and attention to the attraction, development, and retention of talent to deliver high levels of service to our customers. Our commitment to them includes a competitive rewards package and programs that support our diverse range of colleagues in rewarding and fulfilling careers. We believe engaged colleagues produce stronger business results and are more likely to build a career with the Company. Each year we conduct engagement surveys that provide colleagues with an opportunity to share their opinions and experiences with respect to their role, their team, and the enterprise to help the Board and management identify areas where we can improve colleague experience. These surveys cover a broad range of topics including development and opportunities, diversity management, recognition, performance, well-being, compliance and continuous improvement. More than 145,000 colleagues participated in each survey and overall engagement stayed consistent across surveys. We strive to invest in our colleagues at all levels of the Company by rewarding performance that balances risk and reward. We recognize how vital our colleagues are to our success and strive to offer comprehensive and competitive wages and benefits to meet the varying needs of our colleagues and their families. The benefits and programs include annual bonuses, 401(k) plans, stock awards, an employee stock purchase plan, health care and insurance benefits, paid time off, flexible work schedules, family leave, dependent care resources, colleague assistance programs and tuition assistance, among many others, depending on eligibility. The Company recognized nearly 180,000 CVS in-store, MinuteClinic in-store, and Distribution Center front-line colleagues who contributed to an outstanding year for the Pharmacy and Consumer Wellness organization by awarding them a special Thank You Bonus, reflecting an approximately $68 million investment in our front-line colleagues. As required by current SEC rules, we are disclosing the ratio of compensation of Ms. Lynch, our CEO in 2023, to that of the employee whose annual compensation is the median of all of our employees. To calculate the ratio, we used an employee in the same pay range and in a similar position to the median employee that was identified in 2022. There has been no material change in our employee population or compensation arrangements that we reasonably believe would result in a significant change to our pay ratio disclosure or our median employee. However, we did not use the original median employee for 2023 because the original median employee experienced a change in circumstances in 2023. As permitted under the SEC rules, for 2023, we chose to use a substitute employee who was immediately adjacent to the original median employee and had substantially similar compensation to that of the original median employee based on the compensation measure we had used to select the original median employee. We have excluded employees acquired from Oak Street Health (7,350) and Signify Health (2,586) as of December 31, 2023 for purposes of determining whether there was a material change in the employee population or compensation arrangements that would result in a significant change to our pay ratio disclosure. We identified the median employee in 2022 by ranking the total compensation based on W-2 information for all employees, excluding Ms. Lynch, who were employed by the Company on December 31, 2022. As of December 31, 2022, we employed over 300,000 employees, which included approximately 75% of whom were full-time employees, and which included many part-time, temporary and seasonal workers. Adjustments were made to annualize the compensation of full-time and part-time employees who were not employed by the Company for the entire 2022 calendar year. We did not apply any cost-of-living adjustments as part of the calculation. As permitted by SEC rules under the de minimis exception, we excluded 469 employees located outside the United States, who represented less than 5% of our total employees, as of December 31, 2022, as follows: Bermuda (1), Canada (11), China (89), Hong Kong Special Administrative Region (18), Indonesia (4), Ireland (9), Singapore (33), United Arab Emirates (95) and United Kingdom (209). Consistent with historical practice and as mentioned above, we also excluded employees who joined CVS Health through businesses that we acquired during 2023, including those from our acquisitions of Oak Street Health and Signify Health. Using this methodology, our median employee was determined to be a full-time employee. The annual compensation for our median employee in 2023 was $55,237 calculated in accordance with the rules applicable to the SCT which begins on page 79 of this proxy statement. The annual compensation for our median employee also includes the Company-paid portion of health benefits plus company contributions to the 401(k) Plan, if applicable. Ms. Lynch’s annual compensation was $21,630,264, which is $15,230 higher than the amount shown in our SCT because of the inclusion of Company-paid medical benefits, which are not reflected in the SCT in accordance with SEC rules. The ratio of Ms. Lynch’s annual compensation to that of our median employee for 2023 is 392-to-1. Given the different methodologies that various public companies use to determine their estimates of pay ratio, including different methodologies, exclusions, estimates, and assumptions allowed under SEC rules, and different employment and compensation practices among companies, the ratio reported above should not be used as a basis for comparison between CVS Health and other companies.

  146. Pay Versus Performance

    Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and Item 402(v) of Regulation S-K, which was adopted by the SEC in 2022, we are providing the following information regarding the relationship between compensation actually paid (“CAP”) to our principal executive officer (“PEO”) and Non-PEO NEOs and certain financial performance of the Company for the fiscal years listed below. The data included in the CAP columns does not reflect the actual amount of compensation earned or paid to our NEOs during the applicable fiscal year and it is reported solely pursuant to the new SEC rules. The CAP amount also does not represent amounts that have actually been earned or realized, including in respect of PSUs, RSUs and options. Performance conditions for many of these equity awards have either not yet been satisfied or applicable performance information is not yet available. To this end, information in the table may not reflect whether compensation actually realized is aligned with performance. The MP&D Committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown. For additional information about our performance-based pay philosophy and how we align executive compensation with CVS Health’s performance, refer to the CD&A beginning on page 48.

  147. Pay Versus Performance

    | | | | | | Average Summary Compensation Table Total for | Average Compensation Actually Paid | Value of Initial Fixed $100 Investment Based On:(5) | | | | | Year | Summary Compensation Table Total for PEO 1(1)(2) ($) | Summary Compensation Table Total for PEO 2(1)(2) ($) | Compensation Actually Paid to PEO 1(1)(3)(4) ($) | Compensation Actually Paid to PEO 2(1)(3)(4) ($) | Non-PEO Named Executive Officers(1)(2) ($) | to Non-PEO Named Executive Officers(1)(3)(4) ($) | Total Shareholder Return ($) | Peer Group Total Shareholder Return ($) | Net Income ($) | Adjusted Earnings Per Share(6) ($) | | (a) | (b) | (b) | (c) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | | 2023 | 21,615,034 | — | 7,497,241 | — | 9,284,957 | 7,685,990 | 118.83 | 143.18 | 8,368,000,000 | 8.74 | | 2022 | 21,317,055 | — | 23,768,152 | — | 12,155,385 | 11,816,298 | 135.85 | 140.29 | 4,327,000,000 | 9.03 | | 2021 | 20,388,412 | 3,784,072 | 66,324,077 | 52,818,429 | 11,876,865 | 38,197,569 | 147.06 | 143.09 | 7,989,000,000 | 8.34 | | 2020 | — | 23,043,822 | — | 8,793,328 | 10,175,614 | 9,988,123 | 94.95 | 113.45 | 7,192,000,000 | 7.50 |

  148. Pay Versus Performance

    | (1) PEO 1 refers to Karen S. Lynch, our current PEO, who became our PEO on February 1, 2021. PEO 2 refers to Larry J. Merlo who was our PEO during the period from January 1, 2020 to January 31, 2021. The individuals comprising the Non-PEO NEOs for each year presented are listed below. |

  149. Pay Versus Performance

    | 2023 | 2022 | 2021 | 2020 | | Thomas F. Cowhey | Shawn M. Guertin | Shawn M. Guertin | Karen S. Lynch | | Samrat S. Khichi | Alan M. Lotvin | Troyen A. Brennan | Eva C. Boratto | | Tilak Mandadi | Tilak Mandadi | Alan M. Lotvin | Alan M. Lotvin | | Prem S. Shaw | Prem S. Shah | Jonathan C. Roberts | Jonathan C. Roberts | | Shawn M. Guertin | | Eva C. Boratto | |

  150. Pay Versus Performance

    | (2) The amounts reported in columns (b) are the amounts of total compensation reported for the PEOs for each corresponding year in the “Total” column of the SCT. The amounts reported in column (d) represent the average of the amounts of total compensation reported for our non-PEO NEOs, as a group, for each corresponding year in the “Total” column of the SCT. | | (3) The amounts shown for CAP in columns (c) have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized or received by the Company’s NEOs. These amounts reflect the “Total” column of the SCT for the applicable year with certain adjustments as required by Item 402(v) of Regulation S-K, which are set forth below. | | (4) CAP reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the “Exclusion of Stock Awards and Option Awards” column are the totals from the “Stock Awards” and “Option Awards” columns set forth in the SCT. Amounts in the “Exclusion of Change in Pension Value” column reflect the amounts attributable to the change in pension value reported in the SCT. Because the Aetna Pension Plan is frozen, there is no adjustment for the service cost for services rendered during the listed year. |

  151. Pay Versus Performance Relationship Disclosures

    Pay Versus Performance Relationship Disclosures

  152. Management Proposal

    | | (shares currently available under the 2017 ICP) + (shares underlying outstanding equity awards under the 2017 ICP) + (additional shares proposed to be authorized under the 2017 ICP) | | Total Potential Dilution = | | | | total number of issued and outstanding shares of common stock (excluding treasury shares) |

  153. The Company’s By-Law Provisions and Corporate Governance Guidelines Provide an Effective and Comprehensive Remedy for Director Nominees Not Receiving a Majority Vote

    The Company’s By-Law Provisions and Corporate Governance Guidelines Provide an Effective and Comprehensive Remedy for Director Nominees Not Receiving a Majority Vote In February 2007, in response to stockholder feedback, CVS Health’s Board amended the Company’s By-laws to adopt a majority vote standard for the election of directors. This standard, which requires each director to receive a majority of the votes cast with respect to that director’s election, underscores CVS Health’s focus on corporate governance and provides for a greater level of accountability of directors to stockholders. Our majority voting standard places CVS Health firmly in-line with other companies. More than 90% of S&P 500 companies have adopted a form of majority voting, a position which we believe is fundamental to creating long-term value for our stockholders. CVS Health’s By-laws go further to address the concerns raised by the Kenneth Steiner Proposal. Although Delaware law permits an incumbent director nominee who is not re-elected to the board to continue to serve as a holdover director until the director’s successor is elected, our By-Laws specifically require each incumbent director nominee to submit an irrevocable resignation in order to be nominated to the Board and, if such director nominee does not receive a majority of the votes cast in an uncontested election, the resignation becomes effective upon the Board’s acceptance. The Board, acting on the recommendation of the N&CG Committee, must decide whether to accept the resignation no later than its next regularly scheduled meeting after certification of the stockholder vote. The Board must accept the director nominee’s resignation unless the Board determines that a compelling reason exists for concluding that it is in the best interests of CVS Health for an unsuccessful director nominee to remain as a director. CVS Health’s Corporate Governance Guidelines reiterate this requirement. While this situation has never arisen, the Board believes that compelling reasons could include addressing a situation where the Board would lack a particular skill or experience if a resignation was accepted without the Board being able to consider alternatives, such as a proper recruitment of a qualified candidate. Although the Board believes that there are very limited situations where there would be a compelling reason to retain a director nominee despite the results of a stockholder vote, it also believes that it is important that it retain the discretion to enable the Board to discharge its fiduciary duty to act in the best interests of the Company and its stockholders if and when such a scenario does arise.

  154. Implementing the Proposal Would Violate Delaware Law

    Implementing the Proposal Would Violate Delaware Law As described above, CVS Health’s By-laws require incumbent director nominees to submit irrevocable resignations that the Board is required to consider and, where in the best interests of CVS Health, accept in circumstances where a director fails to receive a majority of votes cast. CVS Health’s director resignation policy does not call for an immediate removal of a director, but, rather, the Board, in the exercise of its fiduciary duties and in compliance with the Delaware General Corporation Law (the “DGCL”), is required to consider whether it is in the best interests of CVS Health to accept the resignation. Delaware counsel has delivered a formal legal opinion to the Company stating that CVS Health’s director resignation policy would not comply with the requirements of Delaware law if the Kenneth Steiner Proposal is implemented. The Kenneth Steiner Proposal would require “that a director who fails to obtain a majority vote in an uncontested election shall not be nominated by the Board at the next annual shareholder meeting.” This means that the Board would be prohibited from nominating such a director for re-election at the next annual meeting of stockholders, even if the Board, in its exercise of its fiduciary duties, believes that there is a compelling reason to conclude that it is in the best interests of CVS Health for such director to serve on the Board. Under the DGCL, the decision of whether to nominate a person for election or re-election to the Board is a business decision with respect to which the Board is required to exercise its fiduciary duties. The Kenneth Steiner Proposal mandates a substantive business decision on the part of the Board to not renominate any director who has failed to receive a majority of the votes cast for his or her election even where the proper application of its fiduciary duties would require it to do otherwise. Therefore, the Kenneth Steiner Proposal would require CVS Health to implement changes to its director resignation policy that violate Delaware law and expose the Company to liability.

  155. Our Stockholders Have Consistently Shown Strong Support of Our Director Nominees

    Our Stockholders Have Consistently Shown Strong Support of Our Director Nominees Our stockholders have consistently shown strong support for our director nominees over the years, all of whom have been independent (other than our CEO), through their annual meeting votes and during our stockholder outreach. Our annual meeting results have shown that all of our director nominees have historically received overwhelmingly positive voting support from our stockholders, averaging well over 90% support. No director in the history of the Company has failed to receive the majority of stockholder votes in favor of his or her election. Our stockholders also have multiple meaningful channels to provide feedback on the Company’s governance practices through the Company’s robust and ongoing stockholder engagement program. During our stockholder outreach, we continue to hear positive feedback on our corporate governance programs and policies and the high quality of our Board. Given the longstanding and continued support for our director nominees and ongoing feedback during stockholder engagement, we believe that the Kenneth Steiner Proposal is unnecessary.

  156. Our Stockholders Have Shown Strong Support for Our Director Nominees

    Our Stockholders Have Shown Strong Support for Our Director Nominees CVS Health’s stockholders have a long history of electing strong and independent boards. We note that in the past four years, every director nominee has received an affirmative vote greater than 85% of all votes cast at our annual meetings, with an aggregate average of over 97%. Our Board is committed to leading governance practices and CVS Health is always open to stockholder input regarding potential directors and governance. We understand that the topic of director time commitments has increased in importance to our stockholders in recent years, as they have sought to ensure that directors have sufficient capacity to effectively oversee the companies where they serve. During our regular investor outreach, we have not heard any concerns whatsoever regarding the outside commitments of any of our director nominees.

  157. Adjusted EPS

    Adjusted EPS Adjusted EPS is calculated by dividing adjusted income attributable to CVS Health by the Company’s weighted average diluted shares outstanding. The Company defines adjusted income attributable to CVS Health as net income attributable to CVS Health (GAAP measure) excluding the impact of amortization of intangible assets and other items, if any, that neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying business performance, such as acquisition-related transaction and integration costs, restructuring charges, office real estate optimization charges, losses on assets held for sale, opioid litigation charges, gains/losses on divestitures as well as the corresponding income tax benefit or expense related to the items excluded from adjusted income attributable to CVS Health. Effective January 1, 2023, the Company’s non-GAAP financial measures also exclude the impact of net realized capital gains or losses. Prior period financial information presented below reflects both the financial results revised to conform with current presentation, as well as the financial results as previously reported. The following are reconciliations of net income attributable to CVS Health to adjusted income attributable to CVS Health and calculations of GAAP diluted EPS and Adjusted EPS for the years ended December 31, 2023 and 2022:

  158. Adjusted EPS

    | | Year Ended December 31, 2023 | | Year Ended December 31, 2022(13) (revised) | | Year Ended December 31, 2022 (as previously reported) | | | In millions, except for per share amounts | Total Company | Per Common Share | Total Company | Per Common Share | Total Company | Per Common Share | | Net income attributable to CVS Health (GAAP measure) | $8,344 | $6.47 | $4,311 | $3.26 | $4,149 | $3.14 | | Non-GAAP adjustments: | | | | | | | | Amortization of intangible assets(1) (13) | 1,905 | 1.48 | 1,785 | 1.35 | 1,808 | 1.37 | | Net realized capital losses(2)(13) | 497 | 0.38 | 320 | 0.24 | — | — | | Acquisition-related transaction and integration costs(3) | 487 | 0.38 | — | — | — | — | | Restructuring charges(4) | 507 | 0.39 | — | — | — | — | | Office real estate optimization charges(5) | 46 | 0.04 | 117 | 0.09 | 117 | 0.09 | | Loss on assets held for sale(6) | 349 | 0.27 | 2,533 | 1.91 | 2,533 | 1.91 | | Opioid litigation charges(7) | — | — | 5,803 | 4.39 | 5,803 | 4.39 | | Gain on divestiture of subsidiaries(8) | — | — | (475) | (0.36) | (475) | (0.36) | | Tax impact of non-GAAP adjustments(9) | (863) | (0.67) | (2,453) | (1.85) | (2,436) | (1.85) | | Adjusted income attributable to CVS Health | $11,272 | $8.74 | $11,941 | $9.03 | $11,499 | $8.69 | | Weighted average diluted shares outstanding | | 1,290 | | 1,323 | | 1,323 |