Dive Brief:
- Kroger recently launched a new healthcare initiative called Kroger 360care, the Cincinnati Business Courier reported. It expands the grocer's healthcare services and allows hospitals and healthcare networks to use Kroger’s resources to provide more access and lower-cost care.
- As an extension of its 360care, Kroger recently partnered with a Tennessee hospital and healthcare network Ascension Saint Thomas Health to expand services to Kroger customers. The grocer said similar partnerships will follow.
- Kroger currently operates 215 Little Clinic locations across nine states and has more than 2,000 pharmacies. The company has previously expressed interest in a healthcare venture.
Dive Insight:
Kroger has been open about its interest in the healthcare space as it looks to boost revenue and deepen its ties with customers. The goal of 360care is to help patients access high-quality care at an affordable price and utilize Kroger's existing infrastructure to reach more people beyond its core grocery offerings.
The grocery company has taken several steps to add more health-focused offerings. In the pharmacy space, Kroger launched a prescription drug membership program aimed at reducing user drug costs by 85% and acquired pharmacy records from 42 Shopko stores in the Midwest around the same time. It has also set up initiatives to provide better healthcare for Harris Teeter employees and Roundy's customers, and is piloting a program to help customers with depression.
Despite recent initiatives, Kroger has struggled with profitability in its pharmacies, due mainly to industry-wide pressures like lower reimbursement costs.
Other major retailers are investing heavily in healthcare, including Walmart, which announced this summer that it's opening a Walmart Health Center at its Dallas, Georgia, store. It currently operates healthcare clinics in a number of stores, but the new location will offer added services like dental, mental and health counseling, X-rays, and audiology. Walmart also continues to expand programs like its Center for Excellence, which provides knee and hip replacements for employees.
Meanwhile, Giant Eagle recently joined InComm’s OTC Network, which provides supplemental benefits and incentive spending to promote healthy lifestyles, while Publix partnered with Beaufort Memorial Hospital in South Carolina to make prescription delivery services and healthcare more convenient for patients. Costco is piloting prescription delivery with Instacart.
The U.S. continues to lead the world in healthcare spending. Many consumers are dissatisfied with the healthcare system and want to see more affordable, accessible offerings. Only 20% of Americans are satisfied with current healthcare costs, according to a 2018 Gallup poll, while 25% report that cost is the top problem in the U.S.
