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Wal-Mart Aims to Become Largest Provider of Primary Healthcare Services

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"Wal-Mart wants to be your doctor."

"Wal-Mart wants to be your doctor," writes Julie Appleby and Sarah Varney of NPR.

Well, perhaps their aspirations aren't that great. It's more likely that Wal-Mart sees an opportunity in the market and they want in on it.

In a request sent to the their partners, the retail giant writes that they intend “to build a national, integrated, low-cost primary care healthcare platform that will provide preventative and chronic care services that are currently out of reach for millions of Americans.”

Based on their 14-page request, it appears that Wal-Mart is looking to offer medical services that range from the management of diabetes to HIV infections, reports NPR.

On Tuesday, Wal-Mart spokeswoman Tara Raddohl confirmed the proposal.

But where did this marketplace opportunity come from and why has Wal-Mart suddenly become interested in heavily stepping up its investment in the health care industry?

It's called the Patient Protection and Affordable Care Act.

When the federal health law takes effect in 2014, there will be millions of Americans expecting to have government or private health insurance. Obviously, demand for care and medicine will skyrocket.

Wal-Mart intends to meet that demand.

"We have a massive primary care problem that will be made worse by health reform," says Ian Morrison, a Menlo Park, Calif.-based health-care consultant. "Anyone who has a plausible idea on how to solve this should be allowed to play."

Wal-Mart's in-store medical clinics could also be part of a wider effort by doctors and hospitals to "streamline care and lower costs."

"Such collaborations [between doctors and hospitals], known as accountable care organizations, might contract with in-store medical clinics," Paul Howard, a senior fellow with the Manhattan Institute for Policy Research, confirmed in the NPR report.

"In health care, Wal-Mart has already flexed its super-size muscles when it comes to prescription drugs," says Ed Kaplan, a senior vice president at The Segal Company, an HR benefits firm.

Kaplan went on to say that Wal-Mart could "bring its massive purchasing power to medical supplies, diabetes test strips, just about anything."

Indeed, their efforts to collaborate with others on health care could actually help lower costs for some patients and increase access to primary care services.

Furthermore, with their impressive shipping network, Wal-Mart may be able to bring an element to the health care industry that could be very lucrative for both itself and its partners.

Nevertheless, their approach has detractors.

Glen Stream, president of the American Academy of Family Physicians, says Wal-Mart's proposal takes health care in the wrong direction by further fragmenting care. The argument is that patients should seek care from physicians who are familiar with the patient and the history of their health.

Aside from the philosophy of the doctor/patient relationship, there are critics who believe Wal-Mart’s newest initiative just won’t work.

"Maybe Wal-Mart can deliver a lot of this stuff more cheaply because it is an expert at doing this with other types of widgets, but health care is not a widget and managing individual human beings is not nearly as simple as selling commercial products to consumers," says Ann O'Malley, a physician and senior health researcher at the Center for Studying Health System Change.

Currently, Wal-Mart has a number of in-store clinics but it has yet to figure out how to streamline its clinic business model.

NPR explains the current situation:

Until recently, Wal-Mart was the nation's leader in opening [in-store] clinics, but has dropped to third place with about 140 of them, well behind CVS Caremark's nearly 550 Minute Clinics and Walgreens' 355 Take Care clinics, according to data tracked by Tom Charland, CEO of Merchant Medicine, a Minnesota-based research and consulting firm.

About 1,300 store-based clinics are open nationwide, he says.

In 2007, Wal-Mart CEO Lee Scott announced the firm would open 400 clinics by 2010.

But early efforts backed by venture capital money faltered and the firm failed to reach that number . . . Wal-Mart then switched strategies and began leasing space to hospital systems, and the clinics began to grow again.

Still, last month, the firm appeared to be struggling: Wal-Mart opened three in-store clinics, but closed 10 . . .

"This is an industry where people haven't figured out how to make money," said Tom Charland. "My guess is the whole purpose of (Wal-Mart's) request for information is to find someone to help them because they've not been able to pull it off.”

(h/t Newser)

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