Walmart, UnitedHealth partner for Medicare highlighting cross-industry benefits
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The partnership between Walmart Inc. (NYSE:WMT) and UnitedHealth Group (UNH) announced Wednesday marks the latest attempt by a major U.S. retailer to enter the healthcare sector.
As part of the 10-year collaboration, the companies expect to serve seniors and Medicare beneficiaries with value-based care through Medicare Advantage plans.
Medicare Advantage is an alternative to the federal health insurance plan Medicare which caters to people aged 65 and above, some younger people with disabilities, and patients with end-stage renal disease.
The deal comes just a month after the e-commerce giant Amazon (AMZN) agreed to acquire membership-based primary care platform One Medical (ONEM) for nearly $3.9B.
Commenting on the deal, Evercore ISI analysts Mike Newshel and Elizabeth Anderson highlighted the mutual benefits for each company.
While Walmart's (WMT) clinics can add new customers from UnitedHealth's Medicare Advantage members, UNH can increase memberships by gaining access to the largest U.S. retailer's footprint.
WMT-UNH partnership, expected to start in 2023 across 15 Walmart Health locations in Florida and Georgia, will expand to additional geographies later.
The companies noted that the arrangement, leveraging analytics and decision support tools of UNH's Optum unit, "will help accelerate the transition to value-based care by enabling clinicians to focus on patient outcomes."
Under value-based healthcare, hospitals and doctors' offices get reimbursed for the care offered to patients through multiple Medicare Advantage plans.
The partnership will include the launch of a co-branded Medicare Advantage plan in Georgia in Jan. 2023.
In the same month, Walmart Health Virtual Care will be an in-network provider for commercial customers in UnitedHealthcare's (UNH) Choice Plus PPO plan.
WMT's partnership with UNH comes days after rival pharmacy operator CVS Health (CVS) announced an agreement to acquire home healthcare company Signify Health (SGFY) in a deal worth ~$8B.