Walmart Decelerates Health Center Expansion Plans

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Walmart launched Walmart Health in 2019, as a one-store pilot in Georgia. Since then, Walmart Health has grown to 48 locations in five states, as of late last year.

The medical centers, which are geared at patients with no or poor insurance coverage in underserved areas, are located next to or inside Walmart Supercenters. They offer a range of services, including primary and urgent care, labs, X-rays and diagnostics, dental, optical, hearing and behavioral health and counseling in one facility.

Walmart says a key differentiator of its centers is their inexpensive and transparent pricing at the point of service. The cost of services at a specific center vary based on factors like the baseline cost of healthcare services in a specific region, patient demographics and underlying area health needs.

The Arkansas-based company is one of a spate of retail giants racing to build up their primary care presence amid growing demand for affordable and convenient medical care. However, some companies have struggled to harmonize the size of their medical networks with the demand of building and operating the clinics.

Walmart says it is taking a more deliberate approach to expansion. However, the company did ratchet up its expansion plans last year before its more recent slowdown. Last March, Walmart said it would open 28 health centers in two new states, Missouri and Arizona, this year. One month later, Walmart said it would open an additional four centers in Oklahoma this year, entering that state for the first time, along with expanding its presence in Texas. Walmart previously said it planned to have more than 75 health centers operational by the end of this year.

Now, Walmart plans to hit that target in early 2025. The company delayed six planned openings in Phoenix, Arizona, due to “significant pressure on construction resources,” the Walmart spokesperson said. Those openings have been pushed back to early 2025. Four additional openings in Oklahoma City have also been paused, the spokesperson said.

Retailers are increasingly angling to snap up a larger slice of the $4.5 trillion healthcare system. Integrating primary care capabilities, whether physical or via telemedicine, allows the companies to provide a front door to the medical system for consumers and nudge them toward other services, like pharmacy capabilities, urgent care clinics, insurance offerings or medical devices for sale in stores.

As a result, the space has seen a number of multi-billion-dollar deals. Last year, CVS purchased value-based medical chain Oak Street Health for $10.6 billion and home care provider Signify Health for $8 billion, while Amazon closed its acquisition of primary care company One Medical for $3.9 billion.

Meanwhile, VillageMD — a primary care operator majority owned by Walgreens — has been actively pursuing deals with provider groups, including an $8.9 billion acquisition of New Jersey-based chain Summit Health. There was also speculation that Walmart was exploring a buy of value-based medical chain ChenMed late last year, though no deal emerged.

As a result of the activity, some 30% of the primary market could belong to nontraditional players by 2030, according to estimates from consultancy Bain. However, some retailers are struggling to manage their swelling networks. Despite a number of provider group acquisitions after gaining control of VillageMD, Walgreens recently pivoted to closing underperforming stores.

Walgreens had closed 140 of the health clinics as of March — more than double its previous goal of 60 closures to hasten the profitability of its health division. Along with its health centers, Walmart has made a number of other plays in the healthcare space, including partnering with an insurer and health system on care coordination in Florida. The company also brokers Medicare Advantage plans and offers co-branded MA plans with insurance giant UnitedHealth.

Walmart also bought a telehealth provider in 2021 and a chronic condition management tech platform in 2020.

 

Source: yahoo!finance

Nashville-Based Montecito Continues Fast Pace Acquisition Number In Qtr. 1 2024 With 11 Medical Office Building Deals

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Montecito Medical, a leading acquirer of medical office properties nationwide, continued its fast pace during the first quarter of 2024.

Some of the company’s latest acquisitions included properties tenanted by market-leading providers ranging from the Mountain West to the eastern seaboard:

Montecito Continues Fast Pace in Q1 Medical Office Acquisitions with 11 MOB Deals (IMAGE CREDIT: Business Wire)

  • Springfield Clinic / Peoria, IL
  • Alpine Orthopaedics / North Logan, Logan, & Brigham City, UT
  • Advocate Aurora Health / Germantown, WI
  • Minnesota Women’s Care / Maplewood & Apple Valley, MN
  • Virginia Women’s Center / Richmond, VA
  • McIver Clinic / Jacksonville, FL

“We continue to see great interest from medical office owners and provider groups seeking to monetize their real estate, and we are helping them make the most of their opportunities not only to build wealth but also to build stronger practices and better serve patients,” said Chip Conk, CEO of Montecito Medical.

 

Source: Valdosta Daily Times

Micro-Hospitals Continue To Make Inroads In US Healthcare

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Sila Realty Trust just announced completion of an $85.5 million healthcare portfolio acquisition whose assets were either micro-hospitals or a facility to offer similar services. It was the latest illustration of the continued growth of this healthcare trend.

The portfolio, located in Arizona and Texas, comprise four built-to-suit micro-hospitals and one freestanding emergency department, totaling approximately 158,000 square feet on a combined 17.5 acres. Each of the micro-hospitals is licensed for 8-inpatient beds, and offers a 13-bed emergency department, operating room, laboratory, diagnostic imaging suite, and a pharmacy. The freestanding emergency department is a 13-bed full-service emergency center, constructed to also offer the same services as the micro-hospitals.

Micro-hospitals have been growing in importance for at least a half dozen years. They are inpatient facilities with a handful of short-stay beds offering some of the same services as larger hospitals—typically emergency services, imaging, pharmacy, lab work and sometimes even outpatient surgeries and primary care—but are cheaper to operate.

Healthcare loves them and their ability to offload demand from large institutions while surgically, if you will, addressing markets. Net lease loves them for their ability to expand need for real estate in areas that might not be able to support a major hospital.

A new example is the micro-hospital expected to open next month in Bellevue, Wisconsin. The Green Bay ER & Hospital is run by Nutex Health, a Houston-based company. It will have six overnight beds and have an emergency department as well as imaging and lab services. There are inpatient and outpatient suites, including pediatric rooms and separate isolation rooms, but no operating rooms.

“We want to start smaller and grow with the community,” facility administrator Sonja Hansen told the Green Bay Press Gazette. “Whether 10 people come through the day or we have 30, we can meet those needs.”

ChristianaCare, which operates three hospitals in northern Delawareand the surrounding area, is expanding into southeastern Pennsylvania through a joint venture with Emerus Holdings, reported the Delaware Business Times. The JV will open three micro-hospitals by 2025 with health and wellness centers and potentially primary care, outpatient diagnostics, and other specialty services.

 

Source: GlobeSt.