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Walmart is ending its telehealth service and closing over 50 health clinics

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NPR's Ayesha Rascoe talks with Forbes senior healthcare contributor Bruce 
Japsen about why Walmart is closing 51 health clinics and what this means 
for the rural populations they served.

AYESHA RASCOE, HOST:

Walmart is getting out of the primary care business. The retail giant said 
Tuesday it's closing 51 clinics and shutting down its telehealth service, 
just five years after jumping into the industry and weeks after saying it 
was expanding into new markets. Bruce Japsen reports on health care for 
Forbes and joins us now. Welcome to the program.

BRUCE JAPSEN: Hey, thanks for having me, Ayesha.

RASCOE: So, when people walk into a Walmart, they'll usually find a 
pharmacy, maybe vision care, but these clinics that we're talking about 
were much more than that, right?

JAPSEN: Yes, they started about five years ago. And Walmart - a lot of 
people don't realize this, but Walmart has done some innovative things in 
health care over the years. Years ago, they had this market-moving move on 
$4 prescriptions. So they thought, you know what? We're - in the markets 
that we operate, which were at one time rural, we're going to expand and 
get into the health care business and start retail clinics. So the first 
clinic they opened in Dallas, Ga., which Dallas, Ga., maybe 20 years ago, 
was rural. Now it's a booming suburban market. They opened a 10,000-
square-foot health center. It would have primary care doctors. It would 
have X-rays. It would have mental health support - all sorts of services, 
and it went well enough. They ended up in five states, and then just a 
month ago, they told me, yeah, we're expanding, you know, we're going. And 
then they reached out and said that they were getting out of it.

RASCOE: Yeah, well, so, what - 'cause, you know, Walmart is obviously 
legendary for maximizing its profit margins and keeping its eyes on the 
bottom line. So is this simply a question of profitability? Like, why did 
they go from announcing expansions to now saying they're going to shutter 
the whole thing?

JAPSEN: Well, that's a great question, because they basically said this - 
after the pandemic, we have a very tight labor market. In healthcare, 
you've had a lot of burnout and hospitals have had to pay a lot of money 
to attract and retain primary care providers. And Walmart basically said, 
for right now, they don't see a sustainable business model because health 
care costs are going up. In some cases, reimbursement is not keeping up. 
They're trying to go into the primary care business when they're competing 
against big hospitals and health care systems. And meanwhile, you know, 
Amazon, Walgreen, CVS - they're all going into - trying to go into this 
primary care market.

RASCOE: So where does this leave the communities where Walmart opened 
these clinics?

JAPSEN: Yeah, that's a great question, because, Ayesha, people like these 
retail clinics. You know, your doctor isn't off office - isn't often open 
on the weekends or after 5 or 6 'o clock. These clinics that Walmart is 
closing - and of course, Walgreens is closing and their partner Village MD 
are closing clinics as well - people love them because you can go and you 
can take your kid, you can take yourself, and you can get care for 
different things. What Walmart did say they're doing in the next 60 to 90 
days, the next 90 days, is they're closing them. They're hoping and they 
think that in some of the markets, because the physicians were on 
contract. Generally, they said they were independent physicians and so 
forth. They're hoping that maybe the local hospital system or health care 
system will take it over. And then they'll have whatever market it is, the 
- hopefully, the local hospital or health care system might move in there 
or keep it going in some capacity.

RASCOE: So, and I mean, as you've mentioned, you know, Walmart is not the 
only big company that got into primary care. You know, you mentioned, you 
know, Walgreens and their clinics that are shutting down - Warren Buffett, 
Amazon's Jeff Bezos, and JP Morgan's Jamie Dimon teamed up to get into 
healthcare and their business called Haven lasted just three years. Is the 
American healthcare system just too complex for newcomers?

JAPSEN: Well, CVS had their earnings this week. And I asked their CEO - I 
said, are you sticking this out? Because they spent $10 billion on primary 
care clinics for seniors. And her answer was, it's complicated, but we're 
sticking in. Amazon has said they're committed to their primary care 
centers. But the company they bought, One Medical - it was losing money 
last year, and my guess is it's probably still losing money. But I think 
people say if we really are going to solve the spiraling healthcare cost 
equation in this country is primary care is where the cost is the 
cheapest, and you want to encourage people to get primary care services. 
It's just that the margins aren't as good.

RASCOE: That's Bruce Japsen of Forbes. Thank you so much for speaking with 
us.

JAPSEN: Thanks for having me.

https://www.npr.org/2024/05/05/1249231441/walmart-is-ending-its-
telehealth-service-and-closing-over-50-health-clinics

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Walmart is ending its telehealth service and closing over 50 health clinics "Thanks Joe..." <thanks@joe.biden> - 2024-05-20 10:31 +0200
  Re: Walmart is ending its telehealth service and closing over 50 health clinics Ed P <esp@snet.n> - 2024-05-20 09:24 -0400
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