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 company stated that the decision was made due to a lack of profitability in these businesses.
The healthcare industry is currently facing intense competition, with companies like Walgreens Boots Alliance, CVS Health Corp, and Amazon.com all vying for market share. Despite efforts to expand their healthcare services during the pandemic, they have been experiencing losses.
In a blog post on Tuesday, Walmart explained that after careful analysis, they had determined that there was no sustainable business model for continuing to operate the health centers. These centers were launched in 2019 and offered primary care, dental care, behavioral health, labs, X-ray, audiology and telehealth services. Last year, Walmart announced plans to expand to more than 75 locations, with 28 new health centers set to open in Texas, Arizona and Missouri.
Walmart did not provide specific closure dates for each center but employees will have the opportunity to transfer to other Walmart or Sam’s Club locations. In contrast to this news Amazon announced in February that it would be cutting several hundred jobs in its healthcare units including clinic operator One Medical which was acquired for $3.5 billion. Additionally Walgreens recorded a $5.8 billion impairment charge on its investment in clinic operator VillageMD in March