Amazon, Walmart missing chance to disrupt healthcare with ASCs

Laura Dyrda -

Amazon, Walmart and other companies aim to make healthcare more efficient and cost-effective, but are missing the surgery center industry entirely.

Walmart's stated mission in healthcare is to offer affordable healthcare with and without insurance, a high level of care from physicians and nurses, and a variety of services in convenient locations. Amazon also aims to personalize the care experience and offer 24/7 access and streamlined processes.

ASCs are the perfect fit for any company that wants to improve quality and lower healthcare costs. As the original healthcare delivery disruptors, physicians first began opening their focused outpatient surgery facilities in the 1970s. The number of ASCs has boomed over the last 20 years to exceed 6,000 ASCs nationwide. Many physicians see a new opportunity to develop new centers as insurers push patients to the high quality, low cost site of service.

It seems like a win-win for big tech and retail companies to work with nimble, entrepreneurial surgery centers to deliver better care. ASCs operating around the U.S. are saving the healthcare system millions because surgery costs less and patients require fewer resources if they're recovering at home. The Ambulatory Surgery Center Association found shifting outpatient procedures from outpatient hospital departments to ASCs saves on average $4,559 per procedure. Patients even pay about $684 less per procedure in the ASC. Insurers are now looking for ways to become more connected with ASCs and bring them into value-based care networks.

One of the big challenges for ASCs is developing a sophisticated IT infrastructure mirroring hospital systems and data collection to effectively participate in value-based contracts. ASCs weren't given the same financial incentives to implement EHRs in the last decade, and many are woefully behind in data gathering and management. The surgery centers also need support in patient communications and process automation to become even more effective. Companies like Amazon and Walmart could leverage their digital and retail competencies to boost ASCs, especially through partnerships with large chains of 100 centers or more.

Instead, both giant companies are focused on virtual care, primary care and pharmacy.

Amazon spread its virtual health services nationwide last year and announced in February it would open in-person clinics in 20 new cities this year. The clinics offer primary care, vaccinations, prescription refills and preventive care and can refer patients out for surgical services. But so far, the tech giant hasn't ventured into disrupting the surgical care delivery model.

Amazon is seeking a physician lead to engage leaders across healthcare organizations, work with strategic partners and provide thought leadership at industry events while also driving "strategic business opportunities" for Amazon Web Services. The company is looking for a physician with experience in analytics, telemedicine and medical imaging; experience with creating value in the healthcare continuum is not a requirement.

Walmart is also focused on telehealth and pharmacy as growth opportunities for the business. The health business was Walmart's fastest-growing line in the fourth quarter of 2021 after focusing on telehealth and allowing pharmacists and techs to practice at the top of their license.

Walmart has also shown it's ready to make serious investments in healthcare, making Epic its EHR for patients, according to an article in Forbes by Sai Balasubramanian, MD. Epic is used among more than 2,000 hospitals and 45,000 clinics nationwide that Walmart could partner with. The EHR isn't as widely used among ASCs, which prefer a simpler and focused specialty platform.

Telehealth, primary care and pharmacy are certainly important, but organizations need to support independent physicians and ASCs as well to meaningfully improve care and lower health spending.

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