CALHOUN, Ga. — Walmart is on a mission to improve the accessibility and affordability of health care in this country. A walk through the second Walmart Health center, which opened in this rural community in northwest Georgia at the end of January, makes the breadth of its commitment clear, but the scope of Walmart’s ambition only comes into focus after listening to some of the people who are leading the effort to help customers live healthier lives, and do so at prices they can afford.
“This is not retail health care,” said Sean Slovenski, senior vice president and president of health and wellness at Walmart U.S., during a recent tour of the new facility. “We deliberately decided that we weren’t going to be in retail health care because it has a limitation of services, which carries a certain connotation.
“We’re in the health care business. That means basing what we do on the needs of the communities where we have stores. If you’re in health care, you do what the community requires, versus retail health care, which has always been about fast, rapid, quick and trying to build volume into the store.”
Like its predecessor, in Dallas, Ga., the Walmart Health center in Calhoun offers a comprehensive suite of services. Housed in an 8,000-square-foot addition to a newly remodeled Supercenter, the facility provides primary and urgent care; X-rays; diagnostic testing; lab work; and dental, optical and hearing care; as well as counseling services. Customers can also obtain help sorting through insurance and other payment options and take advantage of classes (many of them offered in conjunction with Tivity Health) on such subjects as diabetes education, nutrition, prenatal care and various types of exercise.
“What we’re doing is analogous to the business model for our Supercenters,” Slovenski noted. “It’s a one-stop shop. The variety of product, the convenience and the price points make the Supercenter format work. We’ve applied those ideas here, and the community response has been great.”
“We looked at everything that Mr. Sam [Walton] built Walmart on, and used the same principles to build Walmart Health,” added Amber Bynum, senior director of operations for the division.
Providing the wide range of services available at Walmart Health involves an array of medical professionals, including physicians, nurse practitioners, dentists, optometrists and behavioral health specialists, who see people during appointments that range from 15 minutes to an hour or more, depending on the complexity of the patient’s condition. Associates in two new roles, Walmart Care Host and Community Health Worker, are there, respectively, to assist customers in identifying the Walmart Health services that are right for their needs and other local health-related resources.
Low, transparent pricing is a central pillar of Walmart Health. Customers can, for example, receive a primary care examination for $40, have their vision tested for $45 or get a dental checkup for $25, including X-rays. The magnitude of difference in the prices charged by the company and other providers is often as high as 50%.
“One reason we’re able to keep prices down is that we have multiple practices under one roof. That helps balance things out,” Slovenski explained. “And then Walmart is able to remove some of the administrative burden, which also drops the costs down. It’s a little tweak here, and a reduced cost there. Break any of that apart and it doesn’t work.
Bynum noted that the low-cost model that’s taking shape will enable Walmart to achieve “our No. 1 goal, which is taking care of patients.”
That objective is in keeping with the company’s overarching strategy. “Our store is committed to being a center of well-being in the community through our assortment of organic products and groceries and health and wellness offerings at everyday-low prices,” said store manager Michael Boling, whose Supercenter includes a redesigned pharmacy and vision center. “We are excited that Walmart Health just opened to offer health care services to our customers.”
Calhoun has a need for what Walmart Health brings to the community. Like many rural areas throughout America, the town and surrounding Gordon County, which together have a population of some 60,000, are medically underserved. Residents here sometimes have to wait weeks to see a doctor. The company has set out to change that.
“We’re going where we’re needed,” Bynum noted. “We use a very complex algorithm to assess communities and determine where to open. We feel like Calhoun is a great fit for what we’re trying to do.”
Slovenski expanded on why Georgia was chosen as the site for the first two Walmart Health centers: “We tried to decide what state was most representative of our fleet across the country, and where we already had a concentration of resources. These communities are rural, or rural becoming suburban, and that represents over half of the entire fleet of Walmart stores. So the demographic makeup, together with the lack of health care services versus those in a more traditional, established suburban setting, made this the right place.”
It should come as no surprise that the combination of easy access (Walmart Health centers are open from 7:30 a.m. to 7:30 p.m. Monday through Saturday, and 10 a.m. to 6 p.m. on Sundays), high-quality care and low costs has resonated with customers. The opening in Calhoun was attended by several hundred people, including the mayor, county commissioners, the head of the local chamber of commerce and actor Mark Wahlberg. The first Walmart Health location, which debuted in Dallas in September, is already generating solid results.
“We had estimates on what we thought the volume would be for patients and use of these kinds of services, and the community response has exceeded our expectations,” Slovenski said. “That’s been a fantastic thing. It goes back to the need in these communities, where most of Walmart’s stores are located.”
The arrival of Walmart Health in a given market might, at first glance, appear to be a competitive threat to other providers. In actuality, according to the executives, the company is providing access to patients who previously were shut out of the health care system and, in the process, forging opportunities for local medical specialists and hospital systems.
“When you think about it, we’re almost creating a new consumer of health care,” Bynum noted. “When Walmart launched $4 prescriptions a number of years ago, a lot of people thought that we were going to steal all the market share. No, what we did was actually create additional market share. That’s what we see happening with Walmart Health.”
Slovenski elaborated: “About 60% to 65% of the people that come into our stores are cash customers for health care, because they have high deductible plans and can’t afford to use them or they have no insurance at all. And because it’s too expensive to see a physician under those circumstances — many times a doctor won’t accept patients unless they have insurance — they just don’t go. What we’re doing is opening up a whole new group of patients.
“If someone in Gordon County has a medical need and wants to see a primary care doctor, there can be an eight- to nine-week wait for a first appointment. It’s clear there aren’t enough primary care physicians to treat them.”
Partnering with local professionals, Walmart serves as the front door to health care and funnels patients who need a higher level of treatment than it can provide to the appropriate channel. For instance, during the week prior to opening to the public, when the Calhoun health center served only Walmart associates and their family members, two individuals — one who was severely anemic, another who had an irregular electrocardiograph — were immediately sent to the hospital.
“When health systems step back and realize that we can cut the wait time to see a primary care physician by two-thirds or more, and that a certain percentage of those patients are going to need care by specialists or hospitalization, they welcome our presence,” noted Slovenski.
Despite spending twice as much per capita as any other developed country, the U.S. health care system is plagued by high costs, limited access and uneven results. If the early positive results at Walmart Health are sustained, the model has the potential to upend the status quo.
“We’re disintermediating the insurers and the PBMs,” Slovenski said. “It’s very similar to what Walmart does when they get rid of the middleman. They go directly to the manufacturer or become the manufacturer. Same thing here.
“Because we offer cash pricing, you can pay $40 for a doctor visit or we can run it through your insurance if you want us to, but that way it’s going to cost you $80 because it’s more expensive for us to do it that way. What we’re doing is going to change the way that people look at the insurers that now control the market.”
The emergence of Walmart Health could also impact health care professionals and where they choose to practice.
“Honestly, we’re going to have a revolution with the practitioners,” predicted Slovenski, “because when you talk to doctors and dentists and nurses and nurse practitioners, they’re fairly unhappy because they’ve become a cog in the machine. Today’s system is all about volume and repetition to make enough money to sustain a private practice. As a result, they get burned out pretty easily.
“Because we take a holistic approach and everything is integrated at Walmart Health, it goes back to why people became health care professionals in the first place, which is to deliver care to patients. If you really believe that your employees are your most important asset, the happier they are, the better your service is and the better your results are.”
As Walmart Health’s expansion strategy takes shape, Slovenski and his colleagues can draw on the company’s long history of innovation.
“We’re following the business model of the Supercenters but in health care,” said Slovenski. “If you look at the history of Walmart, the company opened up a handful of Supercenters and got the model right. That’s what we are doing here — taking a thoughtful approach to getting the prototype right.”
If the company does decide to scale up its presence in health care, more could be involved than opening a large number of additional locations. The move might also entail the development or acquisition of other assets to create a health care ecosystem.
“The way we’re going about things is just different enough that it allows you to ask, ‘What’s next?’ ” Slovenski said. “Stay turned.”