Several major players in the healthcare industry — Walmart, Optum and Walgreens' VillageMD — are closing or scaling back their healthcare services in 2024.
These decisions, which include shutting down physical clinics and telehealth platforms, have sparked concerns about access to care for thousands of patients across the U.S.
Walmart Health
Walmart Health, known for its approach to providing affordable healthcare services, announced April 30 that it will close all 51 of its health clinics.
The decision to shutter these clinics, which offer primary care, dental and mental health services, was due the "challenging reimbursement environment" and rising operating costs, which resulted in a lack of profitability, Walmart said.
"This change disrupts not only the lives of our staff and providers, but most importantly the rural communities we served," Claude Pirtle, MD, chief medical informatics officer of Walmart Health and Wellness, wrote on LinkedIn on April 30. "Healthcare is convoluted with a multitude of social and economic challenges. It is especially complicated for a new entrant entering into this field."
According to Walmart's website, 90% of the U.S. population resides within a 10-mile radius of a Walmart store. Walmart Health was supposed to deliver accessible and cost-effective health and wellness services in communities where its customers reside and frequent.
The closure of Walmart Health comes as a surprise as the retail giant was expected to expand its healthcare footprint. Last year, Walmart said it would open 28 new Walmart Health center locations, aiming to have more than 75 health centers across the U.S. by the end of 2024.
Optum
Optum, a subsidiary of UnitedHealth Group, told Becker's on April 25 that it will shut down its telehealth business, Optum Virtual Care, which launched in 2021.
The virtual care unit offered access to physicians and nurse practitioners at any time across all 50 states.
"Virtual care has been and will continue to be a core part of our comprehensive, integrated care delivery model designed to provide care to people where, when and how they prefer," an Optum spokesperson told Becker's.
Walgreens and VillageMD
In March, Walgreens made the decision to pull VillageMD clinics from Illinois shortly after it opted to make market exits in Indiana and Florida.
This comes as Walgreens aims to reduce expenses by at least $1 billion, which includes initiatives such as discontinuing VillageMD services in five markets and shuttering approximately 60 clinics during fiscal year 2024.
The partnership between Walgreens and VillageMD intended to provide comprehensive primary care services within Walgreens stores.
The VillageMD market exits come as Walgreens CEO Tim Wentworth told CNBC in January that the company was looking to become more of a healthcare company.