Will doctors prove a cure-all for Walgreens competitive ills?
The doctor is in at Walgreens, or at least he/she soon will be. The pharmacy chain announced yesterday that it has reached an agreement with VillageMD to locate between 500 and 700 primary care doctor’s offices in its stores over the next five years.
Walgreens and VillageMD are looking to place physician-led clinics at the drugstore chain’s locations in 30 markets with plans to “build hundreds more” after meeting the original targeted number. The clinics, known as “Village Medical at Walgreens”, will have footprints of between 3,300- and 9,000-square-feet, depending on the location.
The deal expands upon a successful five-store pilot program between the two companies in Houston last year. The test clinics earned net promoter scores of 90. Walgreens also announced that it has made an immediate $250 million equity investment in VillageMD that will grow to $1 billion over three years.
The primary care concept provides the drugstore chain with a clear point of difference from its main rival, CVS MinuteClinic, which runs in-store clinics with nurse practitioners at more than 1,100 locations.
Walmart is also putting an increased focus on customer care, locating Walmart Health clinics next to one of its stores in Arkansas and three others in Georgia. The clinics, which also employ physicians, provide low-cost primary care service as well as dental, optical and lab services.
Walgreens said that its pharmacists will be integrated as important members of “multi-disciplinary” teams focused on providing superior health care to patients. The clinics accept a variety of health insurance plans and offer around-the-clock care with telehealth and in-home visits in addition to care provided in stores.
Tim Barry, chairman and CEO of VillageMD, said that 85 percent of the $4 trillion spent annually on healthcare in the U.S. is tied to the treatment of patients with chronic diseases.
“This partnership allows us to unleash the power of primary care doctors and pharmacists, enabling them to work in a coordinated way to enhance the patient experience,” he said. “The results of our initial pilot clinics highlight that these outcomes are infinitely achievable.”
- Walgreens and VillageMD to Open 500 to 700 Full-Service Doctor Offices within Next Five Years in a Major Industry First – Walgreens Boots Alliance, Inc./VillageMD
- Will CVS’s HealthHUB concept change what consumers expect of drugstores? – RetailWire
- Would you go to Walmart to see a doctor? – RetailWire
DISCUSSION QUESTIONS: How much of an effect will the widespread launch of the Village Medical at Walgreens concept have on the drugstore retailer’s business? How do you anticipate rivals from CVS to Walmart to respond?