health transformation . institute
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Joaquim Cardoso MSc
Founder and Chief Researcher & Editor
December 21, 2022
Source:
Forbes
Bruce Japsen
December 21, 2022
Amazon’s $3.9 billion acquisition of One Medical has faced public criticism in December 2022 ahead of what had been expected to be an end-of-the-year closing of the deal.
The already hot market of buying physician practices is about to get even hotter should Amazon’s proposed acquisition of One Medical win regulatory approval.
Amazon’s proposed $3.9 billion acquisition of One Medical, which was originally expected to close by the end of this, comes during a period of unprecedented competition for primary care doctor practices …
- with Walgreens opening hundreds of physician-staffed clinics with partner VillageMD
- while Walmart launches its doctor-staffed clinics under the Walmart Health brand in several new markets.
- Meanwhile, CVS Health, which has long staffed its more than 1,100 in-store clinics with nurse practitioners is also rolling out more primary care models that include physicians.
Amazon’s proposed $3.9 billion acquisition of One Medical, which was originally expected to close by the end of this, comes during a period of unprecedented competition for primary care doctor practices …
With Amazon’s backing, One Medical will have a huge financial war chest to expand into a primary care market …
… that already includes well-capitalized hospitals and health systems that are buying up doctor practices along with the new retail rival entrants.
Retail healthcare companies are joining other non-traditional owners of doctor practices like private equity groups and insurance companies in gobbling up physicians, which isn’t expected to change in 2023.
In the case of Walgreens, the company is opening hundreds of doctor-staffed clinics through its $6 billion investment in the primary care company VillageMD …
… while CVS has an array of outpatient expansions in the works from creating in-store HealthHubs with hundreds of new items to forming relationships with physicians to adding new healthcare services to the more than 1,100 CVS MinuteClinics across the U.S. that are staffed by nurse practitioners.
This year, Walmart has opened several new doctor-staffed “Walmart Health” centers in the lucrative Florida market.
Like the healthcare services the retailer’s Walmart Health business has rolled out locations across Arkansas, Georgia and Illinois in the last three years, …
… the Florida facilities will feature an array of primary medical services, urgent care including X-ray services, dental and eye care, and behavioral health services as part of a new model being replicated into other markets.
… the Florida facilities will feature an array of primary medical services, urgent care including X-ray services, dental and eye care, and behavioral health services as part of a new model being replicated into other markets.
A report earlier this year from Physicians Advocacy Institute and the consulting firm Avalere found …
… corporate entities have become a bigger player in owning doctor practices from 2019–2021, particularly during the onset of the pandemic.
“Hospitals and other corporate entities acquired 36,200 additional physician practices over the three-year period (a 36% increase),” the PAI-Avalere report showed.
“Hospitals acquired 4,800 additional physician practices over the three-year period, resulting in an 8% increase in hospital-owned practices.
Corporate entities acquired 31,300 additional physician practices over the three-year period, an 84% increase in corporate-owned practices.”
“Hospitals and other corporate entities acquired 36,200 additional physician practices over the three-year period (a 36% increase),” …
Such consolidation is a worry among some regulators including those examining the Amazon-One Medical transaction.
In Oregon, for example, the state’s health authority is amid a 30-day preliminary review of the transaction.
Such consolidation is a worry among some regulators including those examining the Amazon-One Medical transaction.
Critics of the deal are worried about the potential of Amazon to reduce competition given its size and scale.
“Vertical consolidation, where large companies buy up smaller ones, are particularly concerning due to the potential anticompetitive effects of having fewer and more powerful players controlling the market,” the group, Oregon State Public Interest Research Group, wrote in a Dec. 13, 2022 letter to the Oregon Health Authority.
Neither Amazon nor One Medical responded to an inquiry Monday seeking comment about the status of the deal’s closing.
Originally published at https://www.forbes.com.
