Everyday low doctor bills at Walmart

By Steve Brawner, © 2019 by Steve Brawner Communications, Inc.

Neither lawmakers nor insurance companies apparently can (or will) find a way to control health care costs, so now we’ll see if the company founded by Sam Walton can help.

Walmart on Sept. 13 opened its first Walmart Health clinic in Georgia, offering primary care, mental health, dental, optical and hearing services. More clinics are coming.

The company that promises “everyday low prices” in its stores says the clinics will offer more affordable health services with upfront costs. Located beside a Walmart Supercenter, the Georgia clinic offers services such as adult physicals for $30 and dental exams with X-rays for $25, as reported by the Arkansas Democrat-Gazette. Patients are told roughly what their visit will cost when they make the appointment.

The nation’s largest private-sector employer, which already subsidizes business and technology college degree paths for employees, also will help them earn health care-related degrees and diplomas. Some of those employees eventually will staff those clinics.

Walmart exists to make money, and there’s a lot to be made in health care.

Meanwhile, other major private employers are entering the health care arena. In 2018, Amazon, Berkshire Hathaway and J.P. Morgan announced they were forming an independent company, now called Haven, to organize health care services and cut costs for their 1.2 million employees. That company is still taking shape, but it could shake up the health care system a little and provide a path for other large employers to control their own costs.

We’re reaching the point where something has to give with health care. On Wednesday, the Kaiser Family Foundation released a survey showing that average employer-sponsored family coverage cost $20,576 in 2019, a 5% increase from last year. Workers contributed $6,015 to that amount.

Let that sink in. Private employers paid an average of $14,561 for family coverage. (It was $5,946 for individuals.) If you’re wondering why you didn’t get much of a raise last year – you actually did. It paid for your health insurance.

And those health insurers are doing quite well. As reported by Modern Healthcare in April, the eight largest health insurance companies made a combined $21.9 billion in profits in 2018 off revenues of $718 billion. Those companies’ eight CEOs between them were compensated $143.5 million – an average of $18 million each and a 14.4% increase from the year before.

Walmart CEO Doug McMillon makes a lot of money too – $24 million last year. And the company certainly is not above criticism, including for its paying employees so sparingly that taxpayers must subsidize their livelihoods with food stamps and other benefits. We certainly don’t want the entire health care system to be “Walmart-ized.”

But the company knows how to cut costs and deliver services efficiently, which is how it practically put Kmart and Sears out of business. Maybe Walmart, Amazon and other major private sector employers can introduce some efficiencies that lead to much-needed systemic change.

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Meanwhile, another piece of health care news this week is worth noting. On Wednesday, Juul Labs, which dominates the e-cigarette market, announced it will cease all advertising and replace its CEO.

The announcement comes amidst a rising teen vaping epidemic Juul helped create. The National Institutes of Health says one in four high school seniors has vaped in the last month. Across the country, there have been hundreds of acute lung illnesses and nine deaths related to use (and misuse) of e-cigarettes. The Trump administration has said it will ban flavored e-cigarettes nationwide, as three states have done. Massachusetts is banning all vaping products for four months.

In Arkansas, lawmakers are considering increasing vaping taxes after having already raised the legal age for purchases to 21. Educators are warning them a crisis is brewing.

Next up are the inevitable billion-dollar lawsuits from state attorneys general and plaintiff’s attorneys.

That’s what happened with opioids, including Oxycontin maker Purdue Pharma. It made billions helping create that epidemic and then filed for bankruptcy earlier this week after settling with some state and local governments. Arkansas Attorney General Leslie Rutledge is still determining if Arkansas will participate in this particular settlement, worth up to $12 billion, or seek redress another way.

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To sum it up, health care’s costs continue rising, one of the world’s most effective cost-cutting companies is opening clinics, and the counterattack on the growing vaping epidemic finally has begun.

More to come on all three, no doubt.