Walmart is shutting down its clinics and telehealth service

By now, you’ve probably seen the news that Walmart is closing its health centers and telehealth unit. This comes just a few days after Optum allegedly shuttered its telehealth business, which I covered. Walmart confirmed the news, but said it will keep its network of pharmacies and vision centers.

So what is going on here? Walmart seemed committed to health care, and has been investing it in for over a decade through acquisitions, investments and key hires.

Firstly, whenever we see any news that Big Tech or Big Retail is exiting health care, I see a lot of tweets and posts about how “health care is hard.” We need to stop saying things like this. Health care is indeed hard, but it is intentionally so because our incumbents want to keep it that way. It is not a good thing for patients that a giant retailer with a presence in some of the most underserved parts of the country, and a mission to provide affordable care, had to shut down. And the stated reasons? Escalating costs and reimbursement challenges, per Bloomberg. Relationships like this one with UHC probably didn’t help. As Aledade’s Farzad Mostashari noted, “Walmart is on one the wrong side of a huge information asymmetry in that relationship, and probably on the wrong side of the economics as well.”