Last week Walmart and Doctor on Demand announced a massive primary care telemedicine deal for Walmart employees. An article in HealthLeaders elaborates: 

The new partnership between Walmart and Doctor On Demand features an innovative approach to primary care through telemedicine, says Hill Ferguson, MBA, CEO of the San Francisco–based telehealth services provider.

“This partnership involves not only having a primary care physician assigned to employees but also having a care team that works behind the physician of nurses, pharmacists, coaches, and nutritionists that can help engage patients, many of whom have chronic conditions. We can help patients manage chronic conditions from the comfort of their home, keep them out of the emergency room, and make sure that if they need in-person care that we can route them to the right place where they will optimize for quality and cost,” he says.

The deal will work by integrating Doctor on Demand’s telemedicine model into Walmart’s self-insured employer plan: 

Walmart is self-insured, and the financing of visits is fully integrated into Walmart’s and Humana’s insurance carrier networks, so Doctor On Demand is reimbursed through those payers, Ferguson says.

“The way it works financially is we have a component of cost that is assessed on a per-employee-per-month basis and a component of cost that is assessed on each patient visit. Depending on the type of visit, the price may vary—it may be an urgent care visit, or an initial psychiatry visit, or a follow-up psychology visit. They will all have different visit fees,” he says.

Walmart is paying for the bulk of the telemedicine services. “Walmart contracts directly with Doctor On Demand, and they pay us for the services that we provide. Then they offer our services to their employees for the $4 copay. In effect, they are subsidizing almost all of the cost for the delivery of the care that we are providing,” Ferguson says.

This is another example of how large employers are creating new solutions to try to encourage employee health and cut costs in a world where employer health costs are rising faster than wages. I wrote about an Indiana private employer group that got together to identify and lower healthcare costs for their employer plans in a recent research update. Until healthcare costs cease to rise faster than normal inflation, employers will need to take control of their health plans and look for ways to cut costs. Integrating telemedicine for primary care will help with increasing access and lowering the cost of seeing a doctor.