Walgreens and VillageMD have tested their primary care model by opening five in-store clinics in the Houston area in November. (Photo: Ken Wolter/Shutterstock)
There will soon be a doctor in the house at Walgreens.
The pharmacy chain has struck a deal with VillageMD to have primary care clinics in 500 to 700 of its stores over the next five years, CNBC reports. As part of the deal, Walgreens will invest $1 billion in equity and convertible debt in VillageMD over the next three years, including a just-completed $250 million equity investment.
VillageMD will run and staff the clinics. The primary care provider will also recruit employees and pay their salaries, as well as paying Walgreens to use the space.
Patients will be able to visit the clinics for services including annual check-ups and walk-in appointments. Each clinic will have nine exam rooms, a waiting area, and a four-person physician-led staff who will coordinate with pharmacists in the store. Home visits and telemedicine will also be available.
Existing areas of the drugstores will be converted into clinics. Most clinics will be close to 3,300 square feet, but some will be as large as 9,000 feet.
Walgreens and VillageMD have tested their primary care model by opening five in-store clinics in the Houston area in November. Based on positive reviews from patients, the decision was made to scale up.
VillageMD CEO Tim Barry told CNBC that because Walgreens are located near people's homes, patients will be more likely to see a doctor regularly or get medical matters checked out sooner.
The plan is for more than 50% of the new clinics to open in areas with shortages of health professionals. Barry said opening in those locations will help VillageMD reach "older, sicker and poorer populations" that are often underserved.
Walgreens co-Chief Operating Officer Alex Gourlay agreed. "We want to be everywhere in America where people need health care," he said. "That's always been our position and always will be."
Walgreens isn't the only company expanding into health care, however. Walmart has opened four primary care clinics called Walmart Health, offering its signature upfront pricing and low costs. CVS Health has acquired Aetna and plans to open 1,500 stores featuring clinics and wellness rooms by the end of 2021. Gourlay told CNBC that with 6 in 10 Americans living with at least one chronic condition requiring daily medication, there's more than enough demand to go around.
VillageMD says its clinics will accept different kinds of health insurance, often with copays of up to $10. People can also pay out of pocket, and there will be a sliding scale for those without insurance to help make care affordable.
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Richard Binder
Richard Binder, based in New York, is part of the social media team at ALM. He is also a 2014 recipient of the ASPBE Award for Excellence in the Humorous/Fun Department.
