In a significant move, Walmart has decided to shutter its health centers and telehealth services, citing profitability challenges as the driving force behind this decision.
The retail giant announced the closure of all 51 Walmart Health centers spanning across five states, along with its Walmart Health Virtual Care platform, according to a press release issued on Tuesday (April 30).
Explaining the rationale behind this move, Walmart stated, “This is a difficult decision, and like others, the challenging reimbursement environment and escalating operating costs create a lack of profitability that make the care business unsustainable for us at this time.”
While Walmart has not provided a specific timeline for the closure of each center, it reassured that its existing patients would continue to receive care from its provider partners until the centers cease operations.
Despite this setback, Walmart remains committed to delivering health and wellness services through its extensive network, including 4,600 Pharmacies and 3,000 Vision Centers, as highlighted in the release.
The company expressed its ongoing dedication to innovation, aiming to enhance its core businesses while introducing new services. Walmart cited the Walmart Healthcare Research Institute and upcoming health programs as part of its continued efforts to serve its customers better.
This decision marks a notable departure from Walmart’s recent expansion plans in the healthcare sector. Just three weeks ago, the retailer announced intentions to open 18 additional Walmart Health centers in Texas within the year.
Moreover, in March 2023, Walmart unveiled plans to more than double its health center count by adding over 75 new locations by the end of 2024. This strategic move aimed to broaden access to low-cost, comprehensive care, building on the success of its inaugural Walmart Health center launched in Dallas, Georgia, in 2019.
The decision to discontinue its telehealth offering follows a similar move by UnitedHealth Group, which recently confirmed the closure of its Optum Virtual Care telehealth business, signaling a broader trend within the industry.
Walmart’s pivot away from health centers and telehealth services underscores the complex dynamics and challenges inherent in the healthcare landscape, highlighting the need for sustainable business models to ensure long-term viability.