Walmart quietly launched Walmart Insurance Services LLC. The new business entity moves Walmart beyond just offering education on insurance to selling health insurance policies.

“Yes, you read that right, Walmart now has an insurance agency,” reads multiple new job listings on Walmart’s site.

This follows a presentation by Walmart President of Health and Wellness Sean Slovenski at the American Telemedicine Association’s recent virtual conference: “We didn’t set out to disrupt healthcare. We set out to meet the needs of our customers at Walmart.” That strategy seems to go beyond just in-store clinics and virtual care — with a strong hint toward Walmart focusing on transforming the way consumers find, select, and purchase coverage.

To better understand and triangulate what this move means for the future of healthcare, a team of Forrester analysts weighed in with their thoughts below.

Q: Help us understand what this new entity means for healthcare and why Walmart is making this move now.

Arielle Trzcinski: Walmart’s efforts appear to be focused on Medicare Advantage (MA) so far. However, that sector alone is a sizable opportunity that many such as Oscar Health and Devoted Health have chased in recent years with success. It is yet to be seen if Walmart’s efforts will yield success, however the problem and opportunity remain unresolved.

More than one-third of Medicare beneficiaries are enrolled in an MA plan, however 21% of enrollees change their plan due to a competitor offering a better price point.[i] The 65-and-older population is expected to grow quickly: 82 million by 2050. Furthermore, this population carries great purchase power — consumers ages 50 and older control 70% of the country’s disposable income.

Q: What does this mean for other health insurance products?

Arielle: There is an opportunity for Walmart to expand its offering and appeal to a broad and growing number of consumers who are becoming more cost-conscientious on the backdrop of financial uncertainty. In 2019, families paid an average of over $6,000 in out-of-pocket expenses — a 71% increase over the past 10 years. As more consumers look to lower their healthcare costs, Walmart can be a viable choice, advising consumers on the right plan and simplifying a complex healthcare ecosystem.

Q: How will this move impact the customer experience across the rest of the industry? Will Walmart’s focus on consumer needs have any sort of a ripple effect?

Faith Adams: Forrester’s Customer Experience Index (CX Index™) points to customer service as a key driver for CX performance in health insurance, something that Walmart as a brand is not known for. That said, having an advisor you can meet with face-to-face while running your errands may be able to help Walmart differentiate in healthcare.

Arielle: I agree. Having an advisor walk and talk consumers through the buyer journey for healthcare makes this approach attractive to consumers across all lines of business, not just Medicare Advantage. Walmart may have more leverage in this arena with their legacy efforts helping customers navigate the buyer journey through their education program “Healthcare Begins Here.”  But, it is important to call out that in the 2020 CX Index, Walmart scored in the bottom half of retailers. This set it behind other retailers trying to make a splash in healthcare like Amazon and CVS Health.  With that in mind, what we do know is that this new venture is helping Walmart get closer to its customers, tackling a key pain point expressed by the market, and creating new value through experimentation. Each of these are key recommendations for any business looking to improve the customer experience.

Judy Weader: In general, the market stands to potentially benefit as Walmart’s advisors appear to be planning to resell existing insurance options. Walmart making this investment potentially helps save investment dollars for all health insurers that partner as resellers. This could also be a way for innovative health plans to tap Walmart as a reseller of newly designed products to see how they perform — think lower or no co-pays for things like prescriptions.

Q: How do these efforts tie back to specific pain points you have heard from health insurance customers?

Arielle: Forrester’s Consumer Technographics® data shows that Medicare-aged consumers need more support as the majority still do their own research.[ii] As these consumers are making a choice in healthcare insurance coverage, their top challenges include, in rank order:

1. Figuring out what healthcare insurance plan fits my needs best
2. Comparing the different insurance packages
3. Understanding the benefits
4. Understanding my costs

Q: Isn’t Amazon doing this already? How is this different?

Jeff Becker: We have long followed Amazon’s effort to fix healthcare, but that effort has been a failure. Amazon made healthcare headlines with its acquisition of digital pharmacy PillPack. It followed this with the acquisition of Health Navigator and its limited rollout of Amazon Care. Amazon then hired renowned surgeon Atul Gawande, MD, to rein in the cost of care for its employees.

Gawande’s Haven Healthcare pursued an uninspired care management strategy that mirrors most traditional payors today. Two years since its launch, the company has lost both its CEO and COO and has had no material impact on the industry. While industry outsiders were bullish on Amazon’s potential in healthcare, insurance insiders were always skeptical. We heard from a top 10 US health insurer that Amazon’s strategy is not focused on the most critical area — caring for the sickest of the sick. A disruptive strategy needs to have its sights set on this population to truly impact spend.

 Q: So, what is different about Walmart’s strategy?

Jeff: Walmart is building a healthcare revenue stream focused on seniors, where the sickest of the sick are cared for, and where a more significant impact on the status quo can be made.

Arielle: Furthermore, Walmart is trying to bring its “everyday low prices” to healthcare as Walmart’s healthcare strategy becomes clearer every day and thus far includes a rather comprehensive set of services, all of which carry the mission of improving price transparency. Beyond just the recent insurance announcement, we have also seen Walmart make the following moves in the last month:

  • Walmart healthcare supercenters. Walmart has emphasized leading with cash pay prices for its new health clinics in addition to accepting insurance. Walmart will provide primary care, urgent care, diagnostics, x-rays, behavioral health, and dental care under one roof.
  • CareZone. Walmart acquired this medication management startup in June, including the technology and IP. We know that users can create medication lists, get refill reminders, and set up medication delivery. In terms of ease, the tech allows users to scan their health insurance card or prescriptions labels to make the process easier.
  • Capital Rx. Walmart announced this partnership earlier in the month, on July 7. Capital Rx provides a health plan’s real-time information on prescription drug prices. Together, the collaboration is aimed at bringing transparency of unit prices across specialty and mail-order prescriptions for consumers.

Q: So, what does it all mean?

Arielle: The race to win healthcare is being fought, but not yet won. Walmart appears to be the front-runner this month, but only time will tell if it can deliver. If the company succeeds, it will stand to upend a healthcare market that has long frustrated consumers and fundamentally break the business model of healthcare providers and insurers as it exists today. At a minimum, the following impacts may be seen based on this new insurance entity:

  • For health providers: Disruption is coming from aisle nine, not D.C. Walmart is now in the position to negotiate Walmart physicians and clinics as the preferred providers with health insurance companies due to new partnerships and an increased focus on pricing transparency. The time to address price transparency is now. Don’t sit back and wait for legislation to force your hand.
  • For health insurers: Forge partnerships now but don’t trust the snake in the grass. Amazon has made bold promises around plan redesign because it’s what consumers want. We would be surprised if Walmart started writing their own policies due to capital needs. In comparison to larger insurers, however, it casts a shadow on new entrants to the Medicare Advantage market. Legacy plans that don’t get with the program stand to lose if Walmart partners with more innovative newcomers. Innovate plan design now. Tap into voice-of-the-customer data, invest in experiences that make your customers feel appreciated, respected, and valued, and lower the cost to consumers.
  • For employers: Walmart health clinics may be an attractive alternative for your employees come open enrollment this year. Self-insured employers may stand to benefit from exploring a partnership to improve access to primary care and reduce claim spend.

Q: Is there a possibility that this impacts the broader insurance market? What could it mean for other products like auto, home, life, etc.?

Jeffrey Williams: In the near term, Walmart starting a health insurance agency does not mean it will sell other types of insurance, too. Over the years, Walmart has shown a deep interest in the healthcare marketplace, and this recent move synergistically capitalizes on that experience. Insurance — auto, health, and life — is a complex, highly regulated, and competitive industry that is ripe for disruption. Walmart, as an ecosystem orchestrator is well-positioned to provide its customers a “one-stop shopping experience” — they can get eggs, cereal, milk, cleaning supplies, and now health insurance. Its entry into selling health insurance makes sense. It is acting as a gateway to a customer segment that is underserved and doesn’t shop for insurance online or through traditional agency channels. How successful Walmart’s selling of health insurance will be remains to be seen. But if it can get the strategy (data, people, and technology) and profitability right, in the long term, Walmart may extend its agency expertise more deeply into other insurance lines.

Have More Questions?

Request an inquiry here, and check out our continued research on the disruption taking place in healthcare.

Special thanks to all of the analysts that contributed to this analysis, including Arielle Trzcinski, Jeff Becker, Jeffrey Williams, Faith Adams, Judy Weader, TJ Keitt, Sucharita Kodali, Fiona Swerdlow, and Ellen Carney.

Recommended Research

How Amazon Plans To Reinvent Employee Wellness And Disrupt Healthcare

The US Customer Experience Index, 2020

The Top Trends For Health Insurers In 2020

Health Insurers Must Make Data-Driven Decisions On Medicare Advantage Supplemental Benefits Options


[i] Base: 107 US online adults (who are online weekly or more and who have Medicare Advantage health insurance coverage​). Source: Forrester Analytics Consumer Technographics® North American Healthcare Consumer Buyer Journey Survey, 2019 (US)​.

[ii] Source: Forrester Analytics Consumer Technographics® North American Healthcare Consumer Buyer Journey, 2019 (US).