It’s not just Wal-Mart that wants to expand its retail presence: I met with a top executive from CVS last week who outlined the company’s plan to grow in the space. Right now, the pharmacy chain operates 645 MinuteClinics, store-based sites where they handle basic preventive and screening services. CVS plans to add 100 clinics a year, hitting 1,000 clinics by 2015. “It’s basic services and consumers really love it,” says Helena Foulkes, CVS’ chief health strategy officer.
And so does CVS: After years in investment mode, the drugstore chain is on track for its first break-even year. “It’s a business where the costs are fairly fixed, because you have a nurse practitioner regardless of how much volume,” Foulkes told me. “Consumers like it, there’s this shortage of primary care, so all these things are leading to a point where we can essentially see enough patients to break even.”
Primary care has struggled in the United States, partially because of limited financial incentives for health providers: Doctors who go into primary care tend to have the lowest salaries among physicians. Doctors may not see a reason to go into primary care, but CVS and Wal-Mart do: in addition to bringing in revenue themselves, the retail clinics also draw customers into stores and build brand confidence.
“It’s a really big deal,” says Bob Kocher, a former health policy adviser to President Obama. “We have a shortage of primary care and of access. If Wal-Mart comes in, that creates a lot more access in areas where it’s been hard to find a doctor. This could bring low prices and relaible quality in a way that we don’t really see right now.”
There are also skeptics, who question how well retailers can play in the health care space. “Managing individual human beings is not nearly as simple as selling commercial products to consumers," Ann O'Malley, a physician and senior health researcher at the Center for Studying Health System Change, told NPR. But as they continue to grow, we’re about to learn a lot more about what retail clinics can, or can’t do, for our health care system.