Home Pharmacy practice Forecast 2022: Competition in the healthcare retail sector will intensify. Here’s what to expect from Amazon, CVS and Walgreens

Forecast 2022: Competition in the healthcare retail sector will intensify. Here’s what to expect from Amazon, CVS and Walgreens


America’s biggest retailers are placing huge bets on healthcare. As patients increasingly demand lower costs and convenient care delivery, retailers like Walmart, Amazon, CVS and Walgreens have stepped in to meet their needs where traditional providers lack the resources to do so. the same.

All four companies have ramped up their investments in health care this year, entering new areas from primary care to telehealth.

And the health care retail boom is not expected to slow anytime soon. Next year, industry experts predict that retailers will increase their investments in key technologies and tackle issues such as the social determinants of health and data sharing to deliver personalized healthcare experiences to consumers. their clients.

Here are five expert predictions on how the retail healthcare market will shake in 2022.

1. Retailers will adopt omnichannel strategies while leveraging their strengths.

All four of the major retail healthcare players have adopted omnichannel strategies to some extent. The challenge for every company will be to capitalize on their strengths to capture their target market share, said Natalie Schibell, senior analyst at Forrester.

“We’re going to see fierce competition, and if these companies don’t create differentiators, they will fail,” she said.

CVS has focused on omnichannel care delivery this year, with offerings ranging from prescribing to primary care. The company announced in November that it plans to close 900 physical locations over the next three years and create three types of stores: one for primary care, one for its HealthHUB sites, and one for its traditional retail model.

“When they’re done, I would expect it to look like a for-profit version of Kaiser Permanente,” said Todd Huseby, senior partner in the retail healthcare practice at the Kearney consulting firm.

RELATED: CVS Health Plans to Close 900 Stores, Lowers Forecast as Retail Strategy Goes Digital

Amazon has taken a similar approach, expanding its virtual care services and home care services in 2021. But Schibell said its biggest advantage is its massive consumer base and extensive supply chain, which he said. can tap for prescription delivery after Amazon Pharmacy’s 2020 rollout.

“They have a substantial customer base and ultimately that will drive drug prices down for Amazon customers, which is a huge competitive advantage,” she said.

2. Patients will benefit from a more personalized healthcare experience from retailers.

Using new technologies and strategies tailored to each population, retailers will focus on personalizing the consumer experience in healthcare to improve access and build patient confidence, said George Van Antwerp, Managing Director by Deloitte.

“It’s about understanding the consumer and being able to create a personalized set of experiences for them that combines this omnichannel strategy,” he said. “Based on where I am, my illness, my insurance coverage and my existing dynamics, what is the best path to choose and the best way to be supported? “

Antwerp said retailers will also need to consider the demographics of each location – taking into account the social determinants of health – when determining what services to offer and what types of clinicians to hire.

“The footprint of some retail health services in a college town can be very different than what might be in a senior community,” he said.

With more than 5,000 locations nationwide, Walmart will excel in rural areas where access to care is limited, Schibell said.

RELATED: HLTH21: Where Walmart Will Focus Its Health Efforts Over the Next 5-10 Years

And, as CVS opens new clinics, it will have to be strategic about where to place them.

“The reality is that the business will generate more income in the wealthier communities. I don’t know what their strategy will be, but historically that’s what we’ve seen, ”Schibell said.

3. More money will go to primary care at the expense of traditional clinics.

Retail primary care clinics are popping up across the country as companies double their investments.

Walgreens increased its stake in primary care company VillageMD in October to become the majority owner with a $ 5.2 billion investment, with the goal of opening hundreds of clinics through the partnership over the next four years. .

These investments are only expected to increase next year, as retailers look to replace traditional providers, at least for some types of care. Traditional providers will need to adapt if they are to survive, digitizing their services wherever possible and making it easier for patients to get appointments, Schibell said.

RELATED: Consumers Embrace Pharmacy Expansion in Primary Care, Says JD Power

“Primary care physicians across the country: beware. You will need to make sure you offer these digital services and this level of convenience, ”she said.

4. Retailers will face the problem of interoperability.

If retailers want to be the sole source of primary care for the consumer, they must create data sharing solutions.

Relying on retail clinics for part of a patient’s care could help lower overall costs, Schibell said. But although some retailers have made efforts to link patient records, such as Walmart in its September partnership with Epic’s electronic health record, it said current solutions do not fully enable the new model of care that it is. these companies offer.

“It’s a smoother approach, but I’m also a little worried. When you have all of these different options available, you have patients who could see their primary care doctor, and then they could see a doctor at CVS or Walmart, and you need to make sure the EHR reflects all the information needed. on this patient, ”she said.

Huseby said companies may target interoperability solutions for mergers and acquisitions in the new year.

“I think you would expect to see significant investments in the interoperability of electronic health records,” he said. “What’s not clear to me is how all of this data from different DSEs and various vendors is going to go into a CVS or Walgreens or Walmart EHR that they present as a dashboard to the consumer.”

RELATED: Amazon Deploys AWS for Health Cloud Services for Healthcare, Genomics, and Biopharmacy

5. Expect more investment in cloud solutions.

Seeing potentially millions of patients also requires robust systems for data collection and analysis, and experts expect retailers to invest more money in cloud-based technologies to meet their needs.

CVS’s partnership with Microsoft, announced in early December, aims to personalize customer service by leveraging the tech giant’s tools, including cloud computing. As part of this collaboration, the pharmacy giant plans to migrate 1,500 new and existing business applications to Azure.

In July, Amazon rolled out Amazon Web Services for Health, with cloud-based solutions for healthcare, genomics, and biopharma. The company recently announced that biotech giant Gilead Sciences will use its cloud services.

These investments will also help retailers personalize the consumer experience, Huseby said.

“They will definitely invest in the technology, it will be cloud based, because it will help them automate and innovate faster, and it will lead to a lot more self-service for consumers on mobile devices,” he said. he declares. .