Forgive the typos, disjointed thinking, and potentially-bad grammar - I did this in a few minutes while the kids weren't getting into trouble.
Wal-mart will have an impact on the non-insured and those in consumer-driven health plans (CDHPs). The high-probability impacts I see are as follows:
1. Showing the value of an "integrated" ambulatory delivery network (measures: capture rate of repeat business, revenue growth, visit growth, CDHP payer mix)
2. Showing the value of a one-stop shopping experience pharmacy, optham., and durable medical equipment supplies (measures: total healthcare revenue, downstream revenue attributable to an ambulatory visit, revenue growth)
3a. Development of a franchise model for clinics for employers (reselling this as a service to them)
3b. Which will likely drive the uptake of the next wave of CDHPs with a forced front-side clinic, an internal medicine doc for more complex situations (the job just got harder internists), and the only options will be how much risk you want to take in your hospital and catastrophic coverage plan
4. Provision of the service in Sam’s Club Warehouses and Wal-mart stores for small business providers (the question here is do they stay away from Workman's Comp?) with some form of insurance product
5. Wal-mart striking-up a deal with Microsoft or Google for their PHR which would drive CCR standards (why write your own and take the risk) - the marketing of products to these patients will be interesting to watch
6. Wal-mart directing (or forcing) their employees to buy "in-house" services
7. Wal-mart exerting pressure on payers (themselves, likely, as a self-insured entity) for real-time codified and value-added eligibility information as well as real-time claims adjudication
8. Wal-mart branding their sites like the emergency departments do - that is = throughput. Physicians and Health Systems will counter on quality and Wal-mart due to their electronic systems will be able run circles around them for a limited set of cases (I don't think they will be the go-to resource for chronic conditions or other more complex acute episodes).
9. Providers striking arrangements with Wal-mart for CDHP and select patient referrals (those who can pay) - that is, when the situation is more than the Wal-mart Nurse Practitioner can handle or they find something chronic or serious, the provider is on the short-list for referrals.
10. Providers uping the ante with electronic visits and payers being forced to consider paying for these as a differentiator
11. A number of counter-measure strategies to establish barriers to entry
a. Providers embracing the CON laws and asking for expansion to include OPD settings
b. Providers driving JCAHO standards
c. Labs trying to come-up with more stringent CLIA standards for point of care testing (which will cause hospitals using this service delivery mechanism to lose money due to additional compliance costs)
d. Providers and payers pushing for CDHP legislation for offerings which will diminish some of the cost savings
e. Providers, in some states that are anti-for-profit healthcare, enacting laws to make it hard for these clinics to exist
12. Growth in the providers/hospitals (like that California physician) not participating in Care/Caid so they can turn-away unprofitable cases (likely leading to a new set of laws - a safety net is needed and the Government isn't willing to set it up directly)
13. VERY LONG-TERM: Wal-mart expanding to rapid diagnostics and delivery of coordinated services for certain problems - breast cancer, prostate cancer, heart issues. They will do the gravy diagnostics in a rapid fashion while finding like-minded specialists/hospitals to develop a rapid protocol-driven treatment plan at a fixed-cost.
14. The next-generation doc-in-a-box offering (akin to a management services organization) where a physician or group of physicians can buy in rapid fashion a set of processes, staff, services, systems, and service level agreements so they focus on medicine while not worrying as much about the other issues of running a business, especially an outpatient practice. Who knows, maybe they will even come-up with storefront designs that can be built like a McDonalds in rapid-fashion as well as office-building designs akin to a modular home. I would see these being geared towards the younger crowd with a focus on eVisits, teleservices, kiosk-based self service for check-in, chief complaint documentation, vitals capture, and follow-up visit scheduling. For the physicians, there would be an integrated computerized medical record/practice management system with physician portal, referring physician portal and patient portal.
15a. Retail pricing information will now become commonplace for physicians and health systems. Pay attention physicians without a website!
15b. Wal-mart's partnership with Google and/or Microsoft will drive a data standard for retail pricing information (service code, description, price, payment terms, access times, typical service provider, guarantee) - and a local service cost comparison - Froogle for healthcare services.
16. A concerted effort by health systems to brand themselves as the quality providers and educate consumers to their value proposition. This will likely cause some feuds over interpretation of outcome and value (cost for cure, acuity measurement interpretation/accuracy) with some interesting volleys to be exchanged between payers, providers, CMS, and third parties like healthgrades.
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These are the longer-term potential impacts, moderate probability:
1. Encouraging payers to think about direct contracting with providers or franchising their model
2. Driving payers back into the provider business due to Wal-mart making direct contracting with providers - en vogue. Think back to the Humana and Cigna days of a for-profit insurer owning primary care providers.
3. Payers contracting with Wal-mart for select delivery of fee-for-service primary care services to a set of enrollees in order to drive down prices paid to the existing primary care provider base in select communities (where they feel the fees are out of line)
4. Payers exerting more pressure on providers to create the throughput and value the employers' employees get from the Wal-mart clinic.
5a. More uptake of CDHP by employers, exerting pressure on the not-for-profit HMOs, especially those not owned by a health system - bye-bye gravy profits for the not-for-profit health systems.
5b. Some not-for-profit health systems shrink or go out-of-business
5c. More consolidation (few instances are handled well due to differing cultures)
5d. Pressure on Congress to think about new means of funding academic medicine as some of the profitable business areas (payer business, and an economies-of-scale barrier for providers getting into the minute clinic business) will not exist
6. Exerting pressure in select markets which drives some independent physicians to re-constitute the days when independent physician associations were more than just contracting vehicles (moving towards the group practice without walls phenomenon - I see some consultant capitalizing on the FUD and coming-up with a Business 2.0-Web 2.0-Healthcare 2.0 model.
7. The pressure causing some physicians in the targeted markets away from IPAs and back to health systems - potentially as employees.
8. Providers approaching payers for full-capitation contracts to differentiate themselves and show additional value.
9. Providers via health systems approaching employers for direct contracting (pissing-off the payers)
10. Providers (most via health systems) approaching employers for their own franchise clinics (maybe even some small non-national pharmacy chains).
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Added after reading Inga's post:
The distribution channel is a great point to bring-up that was not discretely mentioned in the listings above. There is a wide channel built-in and they do have access to rural areas. This could be a road-warrior's heaven - actually having reliable access to medical care on the road and they have your history available. As more and more road-warriors are being given low premium (high deductible, HSA, consumer-driven = call it what you will) plans, this is a cool concept to direct their way. This got me to thinking about after-hours care. Just give the Nurse Practitioner a Pyxis unit for the common meds and you could get to a point where you may not need a pharmacist, or, they could centralize the pharmacist function where allowed by law and with remotely trigger the meds release from the cabinets.
Added after also reading the Analyst's post:
Cleanliness - great point. The typical crowd may not care much. Taking this comment in conjunction with the after-hours offering, I'd make it a separate covered entrance which could kill 2 birds. The clinic would control its own cleanliness. Wal-mart could provide after-hours services and not need to secure a major entrance.
The pharmacist idea got me to thinking about tele-consults for common specialists who have long wait times - Dermatology!
Yet another idea that came to mind - Wal-mart has a phenomenal logistics and supply chain function. Once they get the experience with the common office setting requirements, they could further offer doc-in-a-box one-stop supplies for many clinics. The synergies from this business concept are really pretty striking.
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Friend of Bob Saccamano
& a Van Buren Boy
Last edited by Art_Vandelay : 08-23-2007 at 09:49 AM.
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