Walgreens Looks to Make a Larger Footprint on Basic Health Care Delivery

Walgreens has upped the ante in its quest to provide basic health care services to consumers at a low cost.

The retail pharmacy chain announced Tuesday that it would provide free care to newly unemployed and uninsured Americans at its Take Care Clinics through the end of 2009, with the help of Quest Diagnostics, Inc., which will provide free lab tests.

The offer applies to most services currently provided at Walgreens’ 342 retail clinics, including routine treatment for colds, sinus infections, bronchitis, strep throat, seasonal allergies, urinary tract infections, pink eye, and skin infections and burns, the company said.

Because patients would have to have lost their job or health insurance on or after March 31, the 3.7 million Americans who have lost their jobs over the last six months are not eligible for the free service. A company spokesman, however, told insideARM that Walgreens’ subsidiary Take Care Health Systems hopes to provide millions of dollars of free service to patients who visit the clinics.

“It’s a response to these tough economic times,” said Gabe Weissman, spokesman for Take Care Health Systems. “Take Care Clinics was founded on the principle of quality convenient and accessible care. We don’t want patients to have to choose between basic necessities such as health care, housing and food.”

Kaulkin Ginsberg Analyst Michael Klozotsky said Walgreens’ free care initiative can’t help but have an impact on medical bad debt.  In the short term, eligible uninsured patients who would otherwise have visited hospital emergency rooms for ailments that require antibiotics will be removed from the bad debt pool.  Longer term, some potentially chronic conditions will be avoided or diagnosed sooner and conceivably treated at lower costs. For that reason Klozotsky said ARM professionals might see a reduction in bad debt in the long term, but shorter term the impact on ARM professionals is negligible.

“If Walgreens was not doing this and these (uninsured and unemployed) people get sick, they are less likely to be able to be able to pay anyway,” Klozotsky said.

Still, Walgreens’ initiative is likely to elevate retail clinics value in mind of consumers and federal lawmakers looking for solutions to health care accessibility and rising costs. Tine Hansen-Turton, executive director of the Convenient Care Association, which represents 96 percent of the nation’s retail clinics, said lawmakers calling for universal care cannot ignore the lack of infrastructure needed to support millions of would-be insured Americans. She said the nation’s nearly 1,200 convenient care clinics can help fill that gap for basic health care service in retail locations and employer sites and the clinics will be looking to play a role in health care reform.

“We welcome being a partner at the table,” Hansen-Turton said. “We will be educating the administration about the value we present from an access, affordability and quality point of view.”

In a op-ed piece published January in the Washington Post Walgreens said “We are addressing the issue of access to care by creating a healthcare-delivery vehicle comprised of 66,000 healthcare professionals across more than 7,000 points of care in drugstores, retail clinics and worksite health and wellness centers. Further, we are advancing the role of nurse practitioners and pharmacists as front-line caregivers.”

Now with its free care initiative, Walgreens is not only trying to get the attention of consumers and lawmakers, it is building brand recognition and consumer loyalty for customers when they once again become employed and insured.

“More than likely the patients who use the clinics will recommend that service to friends and family members in a similar situation because they believe this is a good business…this a company that cares and you should support their business,” Klozotsky said.  “That marketing potentially has value for them down the line.”