By Brian Klepper, PhD
A couple weeks ago, Catalyst for Payment Reform hosted a webinar that provided a glimpse into Walmart’s health care strategy and management plans. Lisa Woods, Senior Director of US Benefits, talked about a new program to simplify and improve health care, particularly primary care, for Walmart’s million-plus associates and their families.
She alluded to Walmart’s well established and continuously expanding Centers of Excellence (COE) programs, as well as two new programs: first is a Personal Healthcare Assistant, powered by health care navigation firm Grand Rounds, that helps Walmart associates with billing and appointment issues, finding a quality provider, understanding a diagnosis, coordinating transportation, arranging child care during appointments, and other important patient needs.
Walmart has also broadened its telehealth offerings, including preventive health, chronic care management, urgent care, and behavioral health. All video visits have a $4.00 copay and associates can book an appointment with a primary care physician within one hour and a behavioral health visit within one week, making services highly accessible. Their partners for this program are Doctors on Demand, Grand Rounds, and Healthscope Benefits.
Daniel Stein and Matthew Resnick, from physician profiler partner Embold Health, described how their data collection/analytics approach identifies physicians with histories of providing the most appropriate care. In three markets – Northwest Arkansas, Tampa/Orlando and Dallas/Ft. Worth – Walmart’s “Featured Provider” program will connect patients to the high-performing providers that Embold has identified in eight specialties: primary care, cardiology, gastroenterology, endocrinology, obstetrics, oncology, orthopedics and pulmonology. Walmart has been a key partner in the development of Embold Health – CEO Daniel Stein is a former Walmart Medical Director – and its efforts to accurately profile the quality of health care delivery at the individual physician level. The health outcomes improvements and savings associated with only using high performing physicians should be profound.
The changes that Walmart has announced reflect a laser focus on solving specific problems, like overtreatment and patient difficulty with navigating the system, that plague all primary care programs. The company has been tinkering with and testing different primary care models for a decade or more. As with its COE program, the goals of Walmart’s new health care programs are a more refined, disciplined, and methodical set of innovations focused on driving better care, a better patient experience and lower cost, and that, for the most part, are not yet available to most primary care patients elsewhere in US health care.
As a side note, it’s worth recognizing that, in an ideal world, the major health plans – e.g., United, CIGNA, Aetna, Anthem – with many millions of lives, would have pioneered these approaches to manage health care risk, to improve health outcomes and reduce cost. The fact that payors haven’t been motivated along these lines is a reflection of the perverse incentives that have driven the US health system for decades, that all patients and purchasers are up against, and that have facilitated the kinds of innovations discussed here.
Walmart attacked these problems because they are at risk for their population and its costs. Few employers have the resolve and the resources available to develop key innovations that can move an industry like health care forward.
Not surprisingly, Walmart appears to see an opportunity here and has larger plans. Walmart almost certainly believes its health care efforts are applicable beyond their own population, and, like Haven, Kroger, and Costco, has staked out a health care business strategy. Primary care are logical services to begin with, and Walmart has announced that its pricing will be 30%-50% below conventional primary care prices. Walmart’s focus on improving experience, health outcomes and cost, combined with its national footprint and deep resource base, could immediately catapult it to the first rank of competitors in this space.
No doubt Walmart has its eye on providing primary care services to groups as well as individuals. Relationships with health plans would allow them to share in the savings they generate through their primary care platform and associated programs.
Think about the territory covered here. Walmart intends to:
- Develop highly price competitive primary care clinics across the country.
- Offer very low cost telemedicine that can be a convenient pathway to primary care and other care, streamlining care processes.
- Implement a Personal Healthcare Assistant that can simplify navigating the health care system and expedite a much enhanced patient experience.
- Connect to the highest performing local physicians and regional COEs in each specialty, driving appropriate and disrupting inappropriate care and cost, in strong contrast to the inappropriate care and cost patterns that have come to dominate US health care.
- Develop some tie to health plans that would allow it to benefit from the health outcomes improvements and savings their management approaches create.
A vigorous primary care campaign by Walmart would undoubtedly threaten traditional primary care models and spur competitive innovation among progressive primary care organizations, especially if it publicly conveyed a dedicated focus on transparent management of full continuum health outcomes and cost. This would powerfully differentiate Walmart’s primary care efforts from those of competitors like Walgreens and CVS, whose convenience care primary care models are mainly dedicated to maintaining the status quo.
Walmart’s activities in this space are one signal that the old paradigm in health care is waning, and a new value-based health care market is emerging. It can’t happen soon enough.