Tuesday, February 23, 2010

Wal-Mart Health Care

The following were notes taken at a recent speech given by columnist Ron Galloway, who often writes on Wal-Mart's effect on the future of health care:

  • 130 million people per week go to Wal-Mart.
  • Wal-Mart is an IT company — and seeks to apply this knowledge to other businesses.
  • Wal-Mart has saved $1.6 billion for pharmacy customers with their $4 generic script program.
  • Wal-Mart plans to have 400 clinics by 2011, and 2,000 clinics by 2014!
  • Wal-Mart needs 11,000 clinic visits per year (in each store) to break even. Each store averages 1.7 million visits per year, so only 7/10 of 1% of visitors can stop by the clinic to make it break even. The fixed co-pay to see the Nurse Practitioner is $65.
  • Roughly 40% of clinic users are uninsured.
  • By 2014, Wal-Mart is projecting a minimum of 11,000 clinic visits to 2,000 stores, which equals 22 million patient visits. And all visits will be captured in their EMR.
  • Wal-Mart projects that 12.5% of their clinic patients would have gone to the Emergency Room. Based on 2,000 clinics, this is diverting 2.8 million visits away from emergency rooms.
  • However, Wal-Mart projects that 10% of clinic visits (about 2.2 million) will require a referral to more specialized care. Even assuming a modest value of $1,000 in the cost for additional services, this equates to $2.2 billion in referral value. Will hospitals be interested in partnering?

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