In a major blow to the healthcare industry, Walmart announced on Tuesday that it will be shutting down all 51 of its health centers in five states across the US, as well as its telehealth operations. The closure comes after a review of the business’s profitability and challenges in reimbursement from insurers and other payers, as well as increasing operating costs.
This move from Walmart is significant given the intense competition in the healthcare sector, with companies like Walgreens Boots Alliance, CVS Health Corp, and Amazon.com vying for market share. 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