CVS announces 1,500 HealthHub locations.
Walmart pilots Walmart Health. Walmart has nearly 5,000 locations (US).
After initial testing in 20 stores, Walgreens expands primary care clinic test to 700 locations, which is to say; it’s working.
What was once a minor threat to healthcare systems —a test destined to fail—is now a rapidly expanding force with thousands of facilities on the horizon.
Naysayers proclaimed, “Well, they are just drug stores or grocery stores. No one wants to go to there for real healthcare.” Like it or not, real healthcare is coming to retail. Customers are making it a part of their healthcare journey.
In order to understand the growing retail healthcare category, here’s a quick breakdown of the three biggest players:
- Describes itself as the largest retailer in the world
- Nine out of ten Americans are within 10 miles of a Walmart (Robin Report)
- Serves approximately 265 million customers per week (Statista)
- Has been testing a comprehensive healthcare offering, which includes primary care, urgent care, diagnostics, x-rays, behavioral health and dental care
- Plans to price a primary care visit at $40 for adults and $20 for kids (MedCityNews)
- Eight out of ten Americans are within 10 miles of a CVS (QZ)
- Expands upon its MinuteClinic offering by creating HealthHub, which offers additional services for managing chronic conditions and personalized pharmacy services
- Acquires Aetna to become a leading provider and improve the consumer experience
- Announces plans to roll out 1,500 HealthHubs (it’s really working!)
- Has nearly 10,000 stores in total
- Has stores located within five miles of 75% of the US population (Walgreens)
- Announces partnership with VillageMD to develop 700 full service primary care offices in the next five years (VillageMD)
- Is hiring 3,600 primary care providers to staff the locations
- Has more than 9,000 stores in total
Through three of the biggest retailers in the country, healthcare systems now must pay full attention to what is happening. The test has now hit full expansion mode. Just looking at the announced expansion of these concepts, the chains are adding 2,200 locations to the healthcare landscape. Not included in this list, but always lurking, because of its success and ability to obliterate entire industries is Amazon. If—or probably when—Amazon gets fully operational in healthcare, systems may see a drastic impact in primary care.
What Makes Retail Healthcare Different
As retailers continue expanding their service offerings, the healthcare industry and retailers alike, must realize it’s time to stop doubting what stores can do and start thinking about what consumers want from healthcare in 2020 and beyond. Retail healthcare understands and is determined to deliver on consumers’ increasing demand for:
- Low costs
In addition, the sheer size and frequency of visits of these players should have traditional players innovating right now. Consumers consistently shop at Walmart, CVS and Walgreens, so they will also be getting constant reminders that these stores offer healthcare. Their success will allow them to promote and support the offerings heavily.
What Should Traditional Providers Do?
It’s time to understand that retail healthcare is a real threat, or perhaps an opportunity to partner. Traditional providers need to analyze their business models and make a decision to either compete with retail for primary care or reposition themselves into more acute and complex healthcare services. With additional options like virtual care and home healthcare offering complementary services related to primary care, systems have even more considerations as they strategize.
Healthcare systems will likely never be able to compete with retail healthcare on price, size or population reach, but they have a level of trust and patient confidence that will be difficult for retail to ever achieve.
If it hasn’t already started, planning must begin now. As retail healthcare is rolling out, the patients are rolling in. If retailers are able to deliver on everything consumers want, the primary care world will never be the same. Will healthcare systems make big enough changes to thrive or will it be too late?
What Should Other Retailers Do?
Retailers with a frequency pattern, loyalty patterns, and strong customer relationships should consider what their opportunities in health services can be. The major players above have clearly determined that there is a strong opportunity to be found in the massive healthcare market.
The key is to identify your niche based on the strength of your brand and market positioning. Food retailers, for instance, may have an opportunity to create a stronger linkage to the connection of food to health and opportunities to tie in OTC and wellness offerings in a more meaningful way. Kroger has started down this path and recognizes the Food as Medicine platform as an avenue for growth, supported by its pharmacies, Little Clinic operation and OptUp app. Similar connections can be made to pediatrics, women’s health, rural health, sports health and many other aspects of the health market, depending on your offering and positioning. Primary care and clinic operations are not the only alternatives for retailers to consider.
Savvy retailers are looking at ways to actively participate in the large and growing health and wellness market, as well as leverage their footprint with services that offer a differentiated experience.
As the customer healthcare journey changes, the opportunity is now for retailers to ensure they are a part of it. What’s your retail healthcare strategy for growth?
We’d love to talk to you about these questions and our related solutions. Connect with me at Dan.Stanek@wdpartners.com.