Walmart Shuts Down Health Centers, Marking a Turning Point for Telemedicine in the Healthcare Industry

Recently, Walmart (WMT) made the decision to shut down 51 of its health centers and discontinue its virtual care services. The reason for this move was a lack of sustainable business model for the retail giant. This announcement came shortly after news that UnitedHealth (UNH) would also be closing its Optum virtual health business.

Walmart initially launched the health centers in 2019 as part of an effort to expand its health services offerings. There were rumors circulating during this time that Walmart may acquire Humana (HUM). In contrast, Amazon (AMZN) has been more aggressive in the health clinic business following its $3.9 billion acquisition of One Medical.

Despite the closure of the health centers, Walmart still maintains nearly 4,600 pharmacies in its stores and has been expanding their range of services. The company also operates over 200 vision centers. The lack of success with Walmart Health Centers is seen as a positive for CVS Health (CVS), which fully embraced the health center model after acquiring Aetna in 2017.

The retreat from virtual care by UnitedHealth and Walmart reflects the challenges faced by companies like Teladoc (TDOC) in the rapidly evolving healthcare industry. In stock market activity, Walmart’s stock dipped slightly while Amazon and CVS saw modest gains. Walmart’s stock has found support at its 50-day moving average as it forms a flat base with a 61.66 buy point. Investors may consider a move past 60.89 as an early entry opportunity. For the latest information on stock market trends and trading decisions, be sure to read IBD’s The Big Picture column and join IBD Live each morning for stock tips before the market opens to enhance your trading strategy through IBD Digital’s premium stock lists, tools, and analysis