Walmart will close all of its health care clinics | CNN Business

Walmart, the largest retailer in the United States, will close all 51 of its health care centers in six states and end virtual health care services, the company said Tuesday.

Walmart had made a big push into health care in recent years, opening clinics next to its superstores that offered primary and urgent care, labs, X-rays, behavioral health and dental work — Arkansas, Florida, Georgia, Illinois, Missouri and Texas. Walmart believed it could use its massive financial scale and store base to offer convenient, low-cost services to patients in rural and underserved areas that lacked primary care options.

But the announcement is an abrupt reversal in Walmart's strategy and may leave a gap in health care access, particularly for lower-income patients without insurance who relied on the centers. Walmart also said it will end virtual health care services.

"One of unique things was they were focused on stores located in underserved communities. It's disappointing that Walmart wasn't able to make it work because these patients need care and don't have as many options," said Ateev Mehrotra, a professor of health care policy and medicine at Harvard Medical School who researches retail health clinics.

Walmart said it was a "difficult decision," but its health care push was not profitable for the company because of the "challenging reimbursement environment and escalating operating costs."

"We determined there is not a sustainable business model for us to continue," the company said.

Mehrotra said Walmart's closures reflect the challenges for primary care providers in the United States. A shortage of up to 55,000 primary care physicians is expected in the next decade, according to the Association of American Medical Colleges.

"This experience highlights the financial struggles that primary care has in general. It really speaks to what primary clinics are facing," he said.

Walmart said it will continue operating its 4,600 pharmacies and more than 3,000 optical centers around the country.

Walmart opened clinics to try to fill a gap for its customers without health insurance, as well as people who have insurance plans with high deductibles and out-of-pocket costs.

"Health care looks like a big opportunity," Walmart CEO Doug McMillion said in 2020, shortly after the first clinics opened.

Soaring costs and access to primary care options remain persistent challenges, especially in rural areas. Walmart chose some of its locations because the areas had higher rates of chronic disease and fewer primary care physicians than average US communities.

Marcus Osborne, Walmart's former vice president of health and wellness transformation, told CNN in 2020 that people who came into the clinics often had not seen a primary care physician in two or three years, or a dentist in five years.

Walmart faced several challenges with its health clinics, including a shortage of medical workers, said Robert Field, a professor of health management and policy at Drexel University.

Walmart's closures show that strength in retail does not always translate into health care, he said.

"It is different from selling products, like toothpaste and breakfast cereal, and requires different kinds of expertise and management," Field said.