How CVS, Amazon and Walgreens are pushing into primary care, home health

Retail giants like CVS, Amazon and Walgreens are knocking down the door of the healthcare and primary care space with multibillion-dollar acquisitions adding healthcare organizations to their offerings.

Walgreens is the latest company to make waves through its acquisitions. Primary care disruptor VillageMD, which is majority-owned by Walgreens, acquired physician practice group Summit Health for $8.9 billion. 

In a recent earnings call, Walgreens CEO Roz Brewer outlined her strategy, saying the company plans to move "swiftly to implement our vision of consumer-centric tech-enabled healthcare solutions that improve outcomes and lower costs for patients, providers and payers."

Walgreens is just the latest company to take a crack at disrupting primary care.

Amazon made waves with its plans to acquire primary care company One Medical for $3.9 billion. Despite a challenging economic environment, the company is betting on reinventing primary care in the same way that they changed retail and online shopping. 

However, the economic situation could pose problems for Amazon's expansion into healthcare. The company recently cited macroeconomic headwinds for its corporate hiring freeze. 

The COVID-19 pandemic made telehealth and digital health necessary. While telehealth use is now declining from its peak during the COVID-19 pandemic, it remains more widely used than it was before the COVID-19 pandemic. 

One Medical has both digital and in-person care offerings, putting Amazon in a good position to deliver care in the new paradigm. However, the company has failed to turn a profit since it initially went public in 2020.

CVS is also focused on acquisitions that improve the convenience of care. The pharmacy company beat out Amazon to acquire home-health company Signify for $8 billion in a deal expected to close in the first half of 2023. CVS hopes that its reputation as a retail health company will help it compete with Amazon.

"[Customers] really want to trust and engage with companies that have earned the right to be in healthcare," CVS CEO Karen Lynch said at an Oct. 12 event in Boston. "I think about Amazon as sort of a transactional company today."

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