Potential of wearable health devices grows
Still in their infancy, wearable health devices offer pharmacists an opportunity to be on the frontlines of what many feel could be an essential part of health care’s future.
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Suppliers and healthcare analysts say that pharmacists are well positioned to be the go-to healthcare professionals to help patients make the most of the data that these devices record, ensuring that the information collected is used to prevent illness and drive outcomes.
As technology companies have delved deeper into health and wellness, the market has seen the development of wearable devices that do everything from monitor activity and sleep patterns to detect body temperature, heart rate, hydration levels and a range of other essential body functions.
Utilizing sophisticated analytic software, these devices let consumers manage their health while giving healthcare providers a powerful tool to monitor (often remotely) patients’ health, improve their care and reduce costs.
In addition, the data collected from wearables allow members of a patient’s healthcare team to meet the growing need to prove that their efforts are driving outcomes.
The potential of wearable devices to revolutionize the way health care is provided across the entire healthcare system is fueling investment in digital health and wearable technology with some forecasters predicting that the market will show huge growth over the next few years. Some estimates said the global market for wearables could expand by as much as 30% a year through 2019.
One of the reasons for the optimism about the vast potential of wearable devices to change the way health care is provided can be found with the number of potential new users for these devices. In a survey of 1,000 patients conducted last summer, PricewaterhouseCoopers found that only 1-in-5 adults in the United States owns a wearable health device and only 1-in-10 use that device every day.
From OTC aisles to fresh fruit: Spreading the health message across the store
Walmart means health and wellness. Increasingly, that’s the message that Wal-Mart Stores is working to convey to the 140 million Americans who walk through its store aisles each week. While the company will continue to serve as the nation’s primary stop for candy, soda, electronics, paper products, gardening supplies and a host of other everyday items, its merchants are elevating the role of over-the-counter medicines, diagnostic and fitness products and other health-related items.
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Marcus Osborne, VP of health-and-wellness payer relations for Walmart U.S., told former U.S. Senate majority leader and physician Bill Frist last February that nonprescription medicines and other over-the-counter products comprise one of the four pillars of Walmart’s strategy for engaging with its customers more effectively as a primary source for health-and-wellness products and services, along with the pharmacy, the vision and hearing clinics, and the new Walmart Care Clinic program.
In part, the elevation and realignment of OTCs and related-health items are about coordinating “departments like baby care and other offerings that holistically mean health and wellness to the customer,” said Paul Beahm, SVP health-and-wellness operations for Walmart U.S. It’s also about using those products to build an overall image of a healthier and more cohesive product offering. By aligning the sales goals and marketing efforts of different store departments more effectively, Walmart’s managers are using those products to boost cross-departmental sales throughout the store — and to steer more shoppers to the pharmacy, vision center and OTC aisles.
Given the aging population, Walmart is also focusing more aggressively on durable medical equipment and home health care, said Labeed Diab, president of health-and-wellness for Walmart U.S. “It’s a one-stop shop,” he noted.
‘The No. 1 share in OTC’
The expanding selection of health-related products like OTC medicines, mobility equipment, diabetic supplies, wearable monitors and active-lifestyle fitness gear fits perfectly with the company’s goal “to be our customers’ destination for everything they need to manage their health.”
That means that “in addition to over-the-counter medicines, prescriptions, blood pressure monitors and advice on health insurance, we have the majority of products customers actually need to live a healthy life, such as fresh produce, apparel, exercise equipment and wearable technology,” the company reports.
What’s more, “we have the No. 1 share in OTC, at a great low price,” Diab said.
It bears repeating that Walmart’s approach in its OTC aisles mirrors that of the rest of the store: to deliver on value and selection. “Our strategy is to lead on price, invest to differentiate on access, be competitive on assortment and deliver a great experience,” the company reported recently. “By leading on price, we earn the trust of our customers every day by providing a broad assortment of quality merchandise and services at everyday low prices. Price leadership is core to who we are,” Walmart adds.
In its 2015 annual shareholders’ report, the company calls itself “an agent for our customer, driving value through improving quality and expanding key brands, at an everyday low price.”
“Additionally, by leveraging our unified physical and digital capabilities, customers have access to approximately 8 million items across our entire product offering, with more to come this year,” the company noted.
‘An opportunity for us’
Sales of over-the-counter medicines and other nonprescription health products were up a respectable 2% last year, according to company reports, and the OTC category still offers plenty of growth potential, Beahm said. “When an item goes from prescription to OTC [status], it’s an opportunity for us to significantly grow our share,” he said. “So the way you really take advantage of that is not just in pharmacy, but by collaborating with the [rest of the] leadership team and making [an Rx-to-OTC product like] Flonase come alive not just in health and wellness, but come alive wherever it’s important to the shopper — such as grocery or lawn and garden.”
Health, wellness and the total store: Linking Walmart pharmacy operations, in-store marketing
A retail pharmacy giant is beginning to fully harness the power of scale. Now firmly established as one of the top retailers of prescription drugs in the United States, Walmart may soon lay claim to an even bigger share of the pharmacy and OTC market as its leaders learn to align pharmacy operations and in-store marketing efforts more closely with other departments within Walmart’s Supercenters, discount stores and Neighborhood Markets.
To do that, the company is changing the relationship structure within its store and field management organizations. The goal: to build bridges of opportunity and mutual support among the various store departments so that the health-and-wellness side of the business can mesh more seamlessly with Walmart’s overall mission of value and one-stop shopping. And the end result, said Paul Beahm, SVP health-and-wellness operations for Walmart U.S., could drive more traffic to both the pharmacy and to other store departments.
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Beahm, a 28-year Walmart veteran, acknowledged that pharmacy is “a specialized business that has a complexity to it.”
“Prior to the relationship change, … we focused on the complexity of it, instead of how much commonality we have between health and wellness and [the rest of the store],” he explained. “So the change was, ‘Let’s begin to align one to one, and be seen as one team.’”
That more holistic, total-store approach has helped elevate the role of pharmacy, health and wellness within Walmart’s total-store offering. “The ideal situation today is that when a regional [pharmacy manager] goes into a store, they don’t just go to the pharmacy and vision center and focus on pharmacy and vision topics. They … look at the departments like baby [care] — the offerings that holistically mean health and wellness to the customer,” Beahm said.
“The goal is to leverage the larger box, the larger business,” he pointed out. “And that only happens through relationships. That’s something that, frankly, we pushed really hard on the last year.”
“If we’re going to close the gap on penetration for health and wellness for the total buy, relationships within the field organization to educate each other on the businesses become one of the most important things,” Beahm added. “So the structure of our field organization is really built around relationships and education, and the end goal is conversion of those [customers] who aren’t using our services.”
‘A tremendous year’
There’s no doubting the scale or market reach of the enterprise. Walmart operates some 4,500 in-store pharmacies in all 50 states.
“We have 17,000 pharmacists, 4,000 opticians and 65,000 associates out in the 4,500 stores” who serve the pharmacy, health-and-wellness side of the business, Beahm explained. Its pharmacists, he added, already “do more than provide medications.” They serve as “part of a continuum of care for our customers, providing clinical services, such as immunizations and comprehensive medical reviews, which include walking patients through their entire health profile as part of their preventive care.”
Under the company’s hub-and-spoke organizational framework, store districts are overseen by pharmacy marketing directors, each of whom is in charge of about 12 Walmart pharmacies. In turn, those directors report to one of 40 regional directors, who Beahm said are “typically but not always centered [along] state lines.”
In charge of those 40 regions, he added, are nine divisional leaders, each of whom has a counterpart on the GM and food side of the business management structure, “so there’s a cross-functional team and relationships, and a structure that supports our pharmacists and the market leaders.”
That means that field and store management are now “aligned geographically,” Beahm added. “But more than that, it’s about how we help each other be successful in each of the businesses.
As Walmart rapidly expands its pharmacy presence into more communities and more urban and suburban markets — the company added more than 100 smaller-format Neighborhood Market stores with pharmacies in January 2015 alone — that kind of cross-functional teamwork and coordinated store marketing and merchandising becomes even more critical. One example of how the approach is already working has been in the quick embrace by local communities of the new pharmacies, Beahm said.
The success of Walmart’s total-store approach to health and wellness is also borne out by recent sales results. “We had a tremendous year in health and wellness” for the fiscal year ended Jan. 31, 2015, said Labeed Diab, president of health-and-wellness for Walmart U.S.
“That doesn’t happen by accident,” Diab continued. “That’s Paul and his leadership team, along with the support of Lindsey Helt’s [senior director health-and-wellness HR] HR team, and the support of the home office team, aligning the players in the stores to the needs of our customers.”
The resources to boost clinical care
But “health and wellness within Walmart is not just about filling prescriptions,” Diab pointed out.
Added Beahm, “We want to be a health-and-wellness destination for our customers, and we’re rapidly changing as the industry moves to provide cutting-edge health services. This year, we’re adding diabetes and disease state management services to our list of clinical services provided by our pharmacists in select stores.”
“These pharmacists will be trained to provide ongoing, in-depth counsel to diabetic and chronic-disease patients in an effort to help them effectively manage their disease,” he said.
To that end, Walmart Pharmacy now employs 53 clinical service managers across the United States who “oversee Walmart’s clinical services and train and educate our pharmacy staff,” Beahm said.
“We plan to more than double the number of pharmacy clinical service managers over the next year,” he added. “The company has given us the resources to allow them to upscale the pharmacies and work with the market directors across the United States [to develop and expand] the things that matter in wellness services,” including health screenings and disease education and management for conditions like diabetes and cardiovascular disease. “As the launch into services occurs, those clinical service managers — pharmacists by trade and education — will spread the word … across multiple stores within their market responsibility,” Beahm explained.
“We’re always looking for new and innovative ways to serve our customers,” Beahm said.
Walmart is also applying the scale of its pharmacy operations and purchasing power to lowering costs both for patients and health plan payers. A prime example: its groundbreaking $4-per-30-day supply generic drug pricing policy offered on hundreds of multisource, widely prescribed medicines.
“Since we launched our $4 prescription program in 2006, our U.S. customers have saved $4 billion on their medications,” declared Mark Phillips, VP pharmaceutical merchandising for Walmart U.S. “Walmart aggressively delivers new options to our customers as generic versions of frequently used medications are released.”
“Public and private health plan sponsors and insurers also have been prime beneficiaries of Walmart’s pharmacy purchasing power and pharmaceutical pricing policies,” said Marcus Osborne, VP health-and-wellness payer relations for Walmart U.S.
“Our mission in payer relations is to develop solutions that drive down costs for the payer customer, because ultimately that will trickle down to the customer who walks through our store,” Osborne said. That means, “looking at opportunities around lowering the cost of distribution,” as well as “creating savings around pharmacy networks through preferred programs or limited pharmacy programs.”