Walgreens creating competitive advantage through outcomes approach to health management
Walgreens released a research article on how health care focused on outcomes could really contribute to lowering healthcare costs. The idea is that by improving individual patient experience, improving the health of the overall patient population and reducing the per capita cost of health care, you can realize better patient outcomes out of invested health resources.
If you take a really close look at what core competencies are necessary to better realize success in that approach, it becomes evident that retail pharmacy is an ideal setting for the process.
Not only does retail pharmacy represent more convenient access, as compared to other healthcare settings, but a lot of this Walgreens is already doing with its loyalty program. The approach is all about aggregating healthcare data and sorting that data to better predict patient behavior. With this you can better target individual patients with personalized interventions (the targeted strategy).
It's also about delivering that health care when, how and where a patient wants it. By tying Balance Rewards loyalty incentives initiatives like Walk with Walgreens and Steps, and fielding a readily accessible health professional base, Walgreens can go a long way toward improving health at the macro level, too (the population strategy). Walgreens' comprehensive vaccination offerings and the recent expansion of clinical services available at Take Care Health into assessing, treating and managing chronic conditions are more examples of how Walgreens can help improve the health of their patients.
But the real synergies will be realized by bringing those two strategies together (the stratified approach) by helping to identify the most efficient way to motivate healthier behavior among patient populations. Judging by Walgreens' Accountable Care Organization partnerships and the number of on-site workplace pharmacies and clinics they operate, Walgreens already has a wealth of experience tying it all together.
This is how patients will be won (and lost) in the future. By demonstrating a proven ability to lower healthcare costs, Walgreens will be able to attract more patient populations tied to employer and health system partners into their stores. Couple that with a strong service-centric front-end proposition, and Walgreens has just formed a significant patient recruitment and retention strategy that will be pretty difficult to replicate.