Walmart To Close Health Clinics In Latest Blow To Retail Healthcare

Walmart is closing its Walmart Health Centers and virtual care operations, saying the retail giant does not see a sustainable business model in primary care.

In the latest blow to the retail health clinic model, Walmart said it would close its 51 Walmart Health centers in five states as well as Walmart Health Virtual Care, the retailer's telemedicine business. The company confirmed on Tuesday that the centers will close within the next 30 to 90 days.

Walmart did not say how much the closures would cost the company, which has spent tens of millions of dollars over the past five years opening primary care centers, which are typically more than 5,000 square feet and include a range of primary care services, dental psychology Healthcare as well as X-rays, immunizations and chronic disease management.

“The decision to close all 51 medical centers across five states and shut down virtual care services was not an easy one,” Walmart said in a blog post on the company's website. “We know this change will impact people's lives – The patients who receive care, the colleagues and providers who deliver care, and the community that supports us along the way, this was a difficult decision, as with others, a challenging reimbursement environment and rising operating costs have led to a lack of profitability that we currently face. The nursing business is unsustainable.

Just a month ago, Walmart said it planned to add 22 new stores in 2024 to deepen its presence in Texas and open new stores in Missouri. A sixth market, Arizona, where expansion is expected in 2025, is where the company does not yet operate a Walmart Health facility.

But Walmart executives say the business environment for recruiting health care professionals and doctors is becoming increasingly difficult amid a U.S. health care workforce crisis and a tight labor market.

Other primary care clinic operators are also facing staffing issues. For example, physician-owned primary care practices have continued to suffer from support staff attrition since the pandemic began, with the number of support staff per physician reduced by 40% since 2019, according to a report last year by the Medical Group Management Association.

As the COVID-19 pandemic and the so-called “Great Resignation” impact physician practices across the country, physician-owned practices will have just 3.0 support staff per full-time equivalent physician in 2022, compared with 3.0 support staff per physician in 2019 Equipped with 5.08 support personnel. MGMA's research reflects on workforce issues in health care, which has been hit hard by the ongoing economic trend of workers quitting their jobs, although research shows health care, education and hospitality are among the hardest hit.

Walmart health executives are finding they are not immune to the health care staffing and workforce crisis facing their employer. “This was a difficult decision, as with others, a challenging reimbursement environment and rising operating costs have resulted in a lack of profitability, making our care business unsustainable at this time,” Walmart said in its blog post.

Walmart's decision to close its health centers and virtual care comes as Amazon expands its One Medical Clinics into new markets and CVS Health added to its portfolio of health care providers with its $10 billion purchase of Oak Street Seniors Health Centers last year. Clinic for Medicare and privatized Medicare Advantage patients.

But Walgreens, which invested billions in VillageMD, a clinic operator with a staff of physicians, is somewhat stuck as it expands too quickly and fails to fill the patient base in some markets it is now exiting. Dilemma. Walgreens last month reported a second-quarter loss of nearly $6 billion, largely due to a loss in the value of its VillageMD investment.

For its part, Walmart said it will now use what the company has learned to focus on “providing trusted health and wellness services nationwide through our nearly 4,600 pharmacies and more than 3,000 vision centers.” ”. “For 40 years, we have provided these high-quality, convenient and affordable care sites that are an integral part of their respective communities.”

The decision, disclosed Tuesday, comes five years after Walmart opened its first 10,000-square-foot Walmart Health Center in Dallas, Georgia, in 2019. concept, and convinced Walmart executives to move forward. The newer Walmart Health Centers are approximately 5,400 square feet, located within Walmart Supercenters and offer Walmart Health’s full suite of wellness services,” the company said. Services include primary care, dental care, behavioral health, lab and X-ray, and Walmart Health Virtual Care telehealth services.

For example, some doctors, dentists and other providers may remain in stores if they negotiate partnerships with local hospitals or health systems. Health care providers within Walmart are independent and often contract to provide care outside of Walmart Health Centers, according to sources close to Walmart.

“Today and in the coming days, our focus is on providing continuity of care for patients and respect and assistance to impacted associates as we begin the process of closing medical centers,” Walmart said in its blog post. “Employees and Providers who make an incredible difference for their patients and communities are a priority: All employees are eligible to transfer to any other Walmart or Sam’s Club location (and) all employees will receive a 90-day Compensation unless they move to another location or leave the company during this period.

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