By Jeff Wardon, Jr., Assistant Editor

Walmart has announced the closure of all its healthcare clinics across the U.S. and its telehealth provider, according to CNBC. This decision comes as a reversal of its previous plans to expand its health services, including dental and medical care, alongside its retail offerings.  

The closure affects 51 clinic locations across five states and is attributed to a broken business model, citing challenges with reimbursement and escalating operating costs. The shortage of healthcare workers in the U.S. has also contributed to increased labor costs.

Related: Over 600 Rural Hospitals at Risk of Closure

Despite previous ambitions to grow its clinic footprint, Walmart struggled with various challenges, including executive turnover, competitive dynamics and the COVID-19 pandemic. The company will now refocus on its traditional health services, maintaining its pharmacies and vision centers. 

“Their business model was unsustainable because they were caught between static reimbursement levels, rising labor costs and other costs,” says Web Golinkin, president of the Convenient Care Association. 

Jeff Wardon, Jr. is the assistant editor for the facilities market.