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Walmart's Healthcare Experiment Has Begun, It May Be A Game Changer


Muda69

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https://mises.org/wire/walmarts-healthcare-experiment-has-begun-it-may-be-game-changer

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I live in exactly the right location to see the outcome of a grand experiment. The pilot Walmart Supercenter is located in Dallas, Georgia. So am I.

On Friday the 13th, the CEO of Walmart cut the ribbon at the grand opening. Sadly, I only learned about this grand opening on the morning of September 14. There had been no publicity while the store was being remodeled over the last 12 months.

So, what you are about to read is based on original research conducted on the cheap on the afternoon of September 14.

1. A Right-Hand Turn

I live in a subdivision that is close to a state highway. The subdivision is surrounded by trees. It is quiet. We cannot hear the traffic. But the highway is centrally located … now more than ever.

My house is about 60 seconds from the highway. When I pull out of the subdivision, I can turn either right or left.

If I turn to the right and drive approximately 1.7 miles, I arrive at the Walmart Supercenter.

I walked into this Supercenter through a new wing: Walmart Health. There, I found a health care delivery system that is far more comprehensive than the standard walk-in clinics that have sprung up in America's mini-malls. Here is what is available.

  • Primary care
  • Dental
  • Counseling
  • Labs & x-rays
  • Health screening
  • Optometry
  • Hearing
  • Fitness & nutrition
  • Health insurance education & enrollment

I have seen it. I am impressed.

Here is Walmart's press release.

The Walmart Health center will offer low, transparent pricing for key health services to provide great care at a great value, regardless of insurance coverage. Customers will be notified on the estimated cost of their visit when they book their appointment.

The Walmart Health center will be operated by qualified medical professionals, including physicians, nurse practitioners, dentists, behavioral health providers, and optometrists. Walmart Care Hosts and Community Health Workers onsite will help customers navigate their visit, understand resources and be a familiar presence for regular visits.

Working in partnership with wellness organizations, the Health Center will offer specialized community health resources, online education, and in-center workshops to educate the community about preventive health and wellness.

You know what a service is going to cost before you sign in.

North_Walmart.png
....

To make room for all this, the Supercenter has reduced the number of checkout lines from 20 to 7. All of them are open, unlike the old Supercenter, which had maybe four or five open at any time. The store has added 26 self-checkout lines.

I asked how many square feet this new addition is. I was told 10,000. Big.

This is one-stop shopping. Are you sick? Go to Walmart. What if you get well? Go to Walmart. Sign up for an exercise program. Want a check-up? Go to Walmart. Sick pet? Go to Walmart. And, as long as you're there anyway, walk inside and buy something. It's convenient. There are 26 self-checkout lines.

Selling health care services is going to get extra foot traffic into the store. My associate John Livingston grasped the strategy at once: "Amazon can't compete against this."

....

2. A Left-Hand Turn

Alternatively, if I turn to the left on the highway and drive approximately 2.6 miles, I arrive at a five-year-old medical center. It is a major hospital: five stories high, plus a large ER wing on a sixth level downstairs on the back side.

Because of the prices charged for services, this facility caters to people with high-end health insurance policies and Medicare. I was treated for stage III prostate cancer for two years. My PSA score peaked at 77 when I arrived. Any score above 7 is worrisome. It is now down to 0.2. This is good news. I received good care. But I did not pay for it. Medicare-based health insurance paid my bills. Without insurance, few people could afford the treatments, which ran $5,626 per daily radiation session (20 minutes) for two months, plus $947 each week for a consultation: a blood pressure test by a nurse and a brief chat with the oncologist.

I had a fainting spell in late May. I had been on medication, Albuterol, that I had to inhale daily for 10 days to deal with pneumonia. I had been diagnosed at a local walk-in clinic. On the day after I ceased the treatments, I fainted. This had not happened before. My wife drove me to a different walk-in clinic to get an assessment. The first one was not yet open. I was told that I could not get an appointment for about six hours. My wife started to drive me home, but when I fainted in the seat, I agreed to be taken to the ER at the hospital. That was around 10 AM.

They got me in very fast, since my blood pressure was quite low. I was in an ER bed for several hours. My wife and I both told the ER nurses and physicians about the Albuterol. I was given two different tests involving large scanning machines. Then they assigned me to an overnight room upstairs. The nurses began taking lots of blood tests. This testing lasted all day and all night. I got to talk with a heart specialist about 3 PM the next day. He said I was probably OK. He offered no explanation for my fainting spells. Everything had tested normal. He said I could leave in an hour. They took one last blood test. I was released around 4 PM. Total time in the hospital: about 30 hours.

My insurance company was billed $29,653.20 — plus $156 for an EKG. I was sent a copy of the bill.

Had this bill been sent to me to pay, I might have gone into cardiac arrest. I would have had to be taken by ambulance back to the hospital.

If it happens again, I'm going to Walmart Health.

Conclusion

Here we see two rival strategies to marketing healthcare services. Walmart's strategy is based on price competition. Patients know what services will cost before they walk into the physician's office. Prices are rock-bottom. This directly benefits patients, who will come again. Word will get out. In contrast, the hospital's strategy is based on billing insurance companies for services whose prices are not revealed to patients in advance. Patients have no economic incentive to seek lower-cost services elsewhere.

These two strategies reflect different organizational legal structures. Walmart is a profit-seeking corporation. Profit-seeking enterprises whose business plans seek a growing market, as Walmart's business plan always has, are forced by price-sensitive consumers to compete by cutting costs and then lowering prices. In contrast, the hospital is a non-profit enterprise. By law, non-profit enterprises have no owners. Employees may not profit directly from innovations that lead to higher profits. In non-profits, everyone is salaried. There is therefore far less incentive to cut costs and reduce prices.

I hope Walmart's experiment proves to be profitable. If it does, more people without health insurance who live in poor rural areas will be able to afford basic medical care. Today, they just cannot afford non-profit medical care. It costs too much

I hope Walmart is successful as well.    A more market based approach to basic healthcare. 

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3 minutes ago, Muda69 said:

Concepts that most consumers of our current health care model equate to "BUT PEOPLE WILL DIE IN THE STREETS!!!!!!!!!!!".

 

I have long contended it will take a visionary to transform our current system. Amazon also comes to mind with regards to changing the game with their acquisition of pharma companies and dabbling in insurance. 

This may not be the answer, but it's a step in the right direction while all the also rans are clamoring for Medi-Care for all. 

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6 hours ago, Impartial_Observer said:

I have long contended it will take a visionary to transform our current system. Amazon also comes to mind with regards to changing the game with their acquisition of pharma companies and dabbling in insurance. 

Amazon will change nothing.

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On 9/18/2019 at 5:51 AM, Impartial_Observer said:

You realize our resident expert on everything took a weekend course at a Holiday Inn and holds/held and insurance license......right?

When you receive a check from the payroll department of an insurance company, as opposed to your usual checks from claims, you may question my credentials.

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Just now, DanteEstonia said:

But this is ultimately about me teaching at Andre Agassi’s charter school, correct?

I don't know.  Just letting the conversation go where it may.  What does the Andre Agassi charter school have to do with walmart and health insurance?

 

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Walmart's Entry Into Health Care Could be Hugely Disruptive in All the Best Wayshttps://reason.com/2019/09/23/walmarts-entry-into-health-care-could-be-hugely-disruptive-in-all-the-best-ways/

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Perhaps the most radical aspect of the new Walmart Heath clinic? Consumers will know exactly what each service costs.

The company has published a pricing list showing that basic check-ups will cost $30 (or $20 for kids) while getting tested for the flu will cost $20 and having a routine vision exam will be $40. The clinic will be staffed with medical professionals capable of handling everything from immunizations to counseling sessions to lab testing to X-rays.

It's a big step forward for Walmart, which is already one of the country's largest pharmacies and which has opened smaller clinics in 19 stores to offer flu shots and other basic health care. Those smaller clinics average about 1,500 square feet each, while the new Walmart Health location in Georgia is over 10,000 square feet, according to Forbes.

It's another sign of how private-sector health care is innovating to reach Americans where they live and shop. CVS and Walgreens already offer small-scale clinics in some retail locations, and both have plans to expand those services in the coming years. If Walmart enters the health care provider marketplace too, it could be a huge victory for competition and convenience.

"Walmart Health is proof that the private sector can deliver high-quality, transparently priced health care services without government intervention," says Elise Amez-Droz, a health care policy associate at the Mercatus Center, a think tank based at George Mason University. "The best way to cater to our varying needs is to let patients have the final say in their health care decisions, shopping for better value and reaping the benefits in the form of better care and savings."

Access to care is an often overlooked part of the national debate over heath care, which tends to focus on providing insurance rather than health care itself. Insurance is important, of course, but the best insurance in the world is useless if there are no providers nearby.

As Amez-Droz notes, the federal government could give every American a voucher for the right to live in Manhattan, but that wouldn't change the fact that not every could move there (or would want to). Walmart and other retailers are helping to solve part of the access issue with these new clinics. About 90 percent of the U.S. population lives within 10 miles of a Walmart store.

The pricing model Walmart is rolling out could smash convention too. Though the retail chain says it will accept most major insurance plans—as it already does in its pharmacies and in existing, smaller clinics—the low, transparent prices will allow many customers to pay out-of-pocket for basic care.

That's a potentially huge change. The lack of transparency in health care prices—largely the result of third parties, like insurance companies, serving as intermediaries between consumer and provider—encourages the inflation of health care costs and the overconsumption of health care. Insurance may always be necessary to cover big expenses, but there's no good reason for Americans not to understand how much a simple visit to the doctor's office will cost before they arrive.

A single Walmart health clinic on the outskirts of Atlanta isn't going to fix any of the big problems with the American health care system. But you'd be foolish to think that the people running one of the world's most efficient and successful companies aren't going to come up with better solutions than the men and women trying to get elected.

The part about paying out-of-pocket for basic care is huge.  IMHO the current medical insurance model regarding the coverage of basic care is broken.  Who here has an automobile insurance policy that covers oil changes, tire rotations, brake service, etc.?  

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7 hours ago, Muda69 said:

Walmart's Entry Into Health Care Could be Hugely Disruptive in All the Best Wayshttps://reason.com/2019/09/23/walmarts-entry-into-health-care-could-be-hugely-disruptive-in-all-the-best-ways/

The part about paying out-of-pocket for basic care is huge.  IMHO the current medical insurance model regarding the coverage of basic care is broken.  Who here has an automobile insurance policy that covers oil changes, tire rotations, brake service, etc.?  

Car repairs can be done at home; medical fixes cannot.

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18 minutes ago, DanteEstonia said:

Car repairs can be done at home; medical fixes cannot.

You didn't answer the question, Dante.

And under a more free market medical system I'm confident medical house calls covering basic care will once again be a viable option for families.  As cheap as WalMart?  No, but affordable enough that some families will pay for the convenience.

 

 

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