- Walmart will shut down the health clinics it has at 51 stores across five states.
- The retailer cited a "challenging reimbursement environment and escalating operating costs."
- The move reverses recent plans to double the number of of clinics at its retail stores.
Walmart says it will shut down the 51 health clinics it has at retail stores across five states, as well as its virtual care operation as the business has become "unsustainable."
"The challenging reimbursement environment and escalating operating costs create a lack of profitability," the company said Tuesday.
The announcement did not provide a specific date for the closures, but sources told the Dallas Morning News and CNBC they would happen over the next 45 to 90 days.
Walmart opened its first health clinic in Georgia in 2019 and since expanded to Arkansas, Florida, Illinois, and Texas.
Staffed by physicians and licensed care providers, the clinics offered services ranging from primary care to behavioral health, as well as labs and X-rays. Virtual care was also available through walmarthealth.com.
Earlier this year, the company had planned to double the number of clinics, but a spokesperson told the Dallas Morning News the decision to close was made after the company received new information about reimbursements from insurers.
Meanwhile, Amazon last year expanded a benefit for Prime members, giving them access to online services and visits at hundreds of One Medical clinics in cities across the US.
By contrast, Walgreens said last month it would close 160 Village MD clinics after taking a $5.8 billion hit in the business.
Walmart continues to operate pharmacies at about 4,600 stores across the US, with over 4,000 those in what it calls "medical provider shortage areas."
"Our pharmacies are often the front door of healthcare," the company said.