In a major move, Walmart announced on Tuesday that it will be shutting down all 51 of its health centers in five states across the United States, as well as its telehealth operations. The closure was due to a lack of profitability in these businesses, said the big-box retailer.
Walmart cited challenges in reimbursement from insurers and other payers as well as increasing operating costs as reasons for the closures. This decision comes at a time when the healthcare sector is facing tough competition from companies like Walgreens Boots Alliance, CVS Health Corp, and Amazon.com. Despite efforts to expand their healthcare services during the pandemic, these companies have been experiencing losses.
In a blog post on Tuesday, Walmart stated that they had determined that there was no sustainable business model to continue operating the health centers. The centers were launched in 2019 and offered primary care, dental care, behavioral health, labs, X-ray, audiology, and telehealth services. Last year, Walmart had announced plans for further expansion to more than 75 locations, with 28 new health centers set to open in Texas, Arizona, and Missouri.
However, the company did not provide a specific closure date for each center. Employees will have the opportunity to transfer to other Walmart or Sam’s Club locations. On the other hand, Amazon announced in February that it would be cutting several hundred jobs in its healthcare units including clinic operator One Medical which was acquired for $3.5 billion. Additionally
