The healthcare landscape is in constant flux, with providers and retailers continually experimenting with new models of care delivery to meet evolving patient needs and market demands. The recent announcement of Advocate Health Care, the largest healthcare system in the Chicago area, closing its 47 in-store clinics within Walgreens pharmacies underscores the challenges of establishing a successful and sustainable retail healthcare model. This decision, effective February 2025, marks the end of a nearly decade-long partnership between the two entities and reflects a broader trend of reassessment and recalibration within the retail healthcare sector. While Advocate shifts its focus to alternative care delivery methods, Walgreens is doubling down on its virtual care offerings, highlighting the growing importance of telehealth and digital solutions in the evolving healthcare ecosystem.
The closure of these clinics reflects the ongoing struggle to find a profitable and effective model for delivering healthcare within retail settings. Walgreens’ experience mirrors similar challenges faced by other major retailers. The company’s substantial investment in VillageMD, a doctor-staffed clinic operator, resulted in significant financial losses due to slower-than-expected patient acquisition. This ultimately led Walgreens to seek an exit strategy from the partnership. Similarly, Walmart shuttered its Walmart Health clinics last year, with roughly half subsequently being managed by health insurer Humana. These instances demonstrate the difficulties inherent in integrating healthcare services into traditional retail environments and the complexities of attracting and retaining patients in this context.
While some retailers struggle, others are forging ahead with innovative approaches. CVS Health, following its acquisition of Oak Street Health, is expanding its network of senior-focused primary care centers nationwide, demonstrating a targeted approach to retail healthcare delivery. Meanwhile, Amazon is expanding its presence in the healthcare arena through strategic partnerships. Building upon its existing relationship with Advocate Health Care for specialized care referrals for One Medical patients, Amazon has announced a similar collaboration with Montefiore Health System in New York. This signals a growing trend of leveraging existing healthcare infrastructure and expertise through partnerships rather than building entirely new in-house capabilities.
Advocate Health Care’s decision to close its Walgreens clinics is not simply a retreat from retail healthcare, but rather a strategic pivot towards alternative care delivery models that align with evolving patient preferences and address specific community needs. The health system emphasizes its commitment to expanding virtual services, providing care within the comfort of patients’ homes. This aligns with the growing demand for convenient and accessible telehealth options. Furthermore, Advocate is investing heavily in community-based care models, including establishing Neighborhood Care locations within churches and community centers, and enhancing its Imani Village outpatient clinic with expanded services and increased appointment availability. This signifies a shift towards a more localized and community-embedded approach to healthcare delivery.
Advocate’s strategic realignment is particularly evident in its commitment to addressing healthcare disparities on Chicago’s South Side. The health system has pledged a substantial $1 billion investment to revitalize healthcare infrastructure and expand access to care in underserved communities. This investment includes the construction of a new hospital to replace a century-old facility, expansion of outpatient care embedded within the community, and programs designed to address social determinants of health. This comprehensive approach acknowledges the multifaceted nature of healthcare disparities and the need for integrated solutions that go beyond traditional medical services.
The closure of Advocate’s Walgreens clinics represents a significant shift in the retail healthcare landscape, highlighting both the challenges and opportunities inherent in this evolving model of care delivery. While some retailers grapple with finding a sustainable and profitable approach, others are innovating and adapting to meet changing patient demands. Advocate’s strategic refocus on virtual care, community-based services, and addressing health disparities on Chicago’s South Side underscores the evolving nature of healthcare delivery and the ongoing search for effective and equitable solutions. The future of retail healthcare remains dynamic and uncertain, but the focus on patient-centered care, technological advancements, and community engagement will likely shape its trajectory in the years to come.
