Walmart’s launch of a Medicare Advantage plan will likely impact provider service volumes
- Walmart will now sell health insurance policies directly to its customers, according to a recent Healthcare Dive article.
- Analysts with SVB Leerlink said, in the same article, that the move underscores the attractiveness of this market and the likelihood of increased competition over time.
- Walmart’s reach across U.S. consumers — including seniors — has the potential to drive up volume for Medicare plans, according to the article.
Healthcare Dive is reporting, “Walmart will now sell health insurance policies directly to its customers, a spokesperson told Healthcare Dive, confirming speculation sparked by job postings from the retailer for Medicare sales managers and insurance agents, first reported by the Arkansas Democrat Gazette. Analysts with SVB Leerlink said the move underscores the attractiveness of this market and the likelihood of increased competition over time, while Walmart’s reach across U.S. consumers — including seniors — has the potential to drive up volume for Medicare plans. Online price lists for basic healthcare services at Walmart Care Clinics show pricing at a 35% to 40% discount to rival CVS HealthHUBs on basic, identical health services.”
This has been long expected given Walmart’s rumored flirtations with Humana and the recent creation of care clinics. And it makes sense as a growth opportunity for Walmart given its brand loyalty coupled with lagging Medicare Advantage (MA) penetration in rural areas (less than 20% in 60% of rural counties versus 32% of metropolitan counties).
Walmart has long been a progressive purchaser of healthcare services for its associates. I anticipate they will bring this experience to bear as they are designing benefits and networks for their MA plan members.
Currently for associates, they are working with Embold Health to curate a high-performance provider network for associates in three markets across key specialties (primary care, cardiology, gastroenterology, endocrinology, obstetrics, oncology, orthopedics and pulmonology).
Because the providers are more efficient, the product will be lower cost. Assuming this can concept can be applied to MA plans, this will likely be well received as MA beneficiaries (62% of them) gravitate to lower-cost plans for lower or no premiums and additional benefits like gym memberships and dental coverage.