Physician Practice, Meet Wal-Mart — Your New Largest Supplier

You've got to credit Wal-Mart with finding new markets to drive growth – in this case, in its own back yard. Over on Healthcare Matters , Tom Finn recently penned a piece summarizing and analyzing Wal-Mart's recent move to tap the growing market for healthcare products and services, selling direct to physician practices. But wait, there's more. Tom notes that "the company won't just sell to small office physicians, but will open its own offices" with in-store retail clinics "operated by contracted physicians, physician assistants and nurses who will be well trained in the use of tools that automate all possible administrative functions (from office registration through prescriptions and billing), driven, of course, by the use of Electronic Health Records (EHRs)."

To date, Tom notes, "Wal-Mart already has 50 in-store clinics with plans to quickly open thousands more." Summarizing his thoughts at the end -- perhaps facetiously, perhaps not, as you never know with Tom -- he notes that as a result of this imitative, "Wal-Mart's future patients will still be the winners, because they'll finally have access to a care model that they'll understand -- and use."

There's another angle to this entire market entrance strategy that Tom has not yet explored (yet I hope he does). And that's the fact that Wal-Mart is known to be one of the most savvy negotiators -- if not the most -- in the retail business. Might they bring this knowledge to healthcare? You bet. And no doubt healthcare suppliers -- from software companies to ultimately imaging and other medical "hardware" -- will face a new, potentially huge, customer with 10x the savvy of most IDNs and hospitals, let alone small physician practices. Perhaps, ultimately, we'll see Wal-Mart become the low-cost distributor in the medical business, serving as a type of Grainger for the broader health industry.

Stranger things have happened. And, when Wal-Mart sees the size of the health opportunity in the US and its growing share of double-digit GDP, you can be sure they have more up their sleeve. And I reckon if this is the case, suppliers won't know what hit them.

Jason Busch