Walmart announced the closing of its health centers and virtual health divisions, Walmart Health and Walmart Health Virtual Care, stating they were not financially sustainable. Since its opening in 2019, Walmart Health operated 51 health centers across five states.

Specific reasons for the closure include the challenging reimbursement environment and increasing operation costs, which made the business non-profitable. The closure process, including dates for shutting down each center, is yet to be determined. However, in the meantime, the currently operating centers will continue to serve customers.

While taking the transition forward, Walmart plans to use the learnings from Walmart Health to continue to offer health and wellness services through its extant nearly 4,600 pharmacies and around 3,000 vision centers. The company is also working toward introducing more services, like the Walmart Healthcare Research Institute, in addition to other health programs.

Analyst QuickTake: This closure marks the latest downsizing of virtual healthcare operations by prominent digital health providers in the recent past. Just last week, UnitedHealthcare announced the closure of its virtual care business, a decision that was driven by business profitability concerns. In October 2023, Walgreens also announced the planned closure of several of its VillageMD clinics , and in August 2022, Amazon announced the closure of its Amazon Care offering in favor of pivoting toward its acquisition of One Medical for a more complete offering. This string of closures could suggest that big-name healthcare providers might reconsider their entries into the retail healthcare space and reassess strategies to maintain profitability.