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VillageMD’s CEO Tim Barry: “Our health care system is failing the citizens of the U.S.”

Gabriel Perna | September 9, 2020

In a year where independent primary-care practices are simply trying to survive the financial fallout of the pandemic, VillageMD received a three-year, $1 billion investment from Walgreens to expand primary-care services to the tune of up to 700 clinics across 30+ markets in the country.  

The changing fortunes of these primary care providers is symbolic of a trend that was happening before the COVID-19 pandemic and will likely only be accentuated after it’s over. “Our health care system is failing the citizens of the U.S. We spend 2.5 times more for health care than any other industrialized nation and yet our quality and outcomes are mediocre at best,” says Tim Barry, CEO of VillageMD. 

The biggest culprit? Barry says it’s the lack of investment into primary care, particularly around patients who need to manage complex diseases and a broken fee-for-service reimbursement model. A shortage of primary-care physicians has led to access issues for patients and a market opportunity for retail companies CVS Health, Walgreens, and Walmart. While CVS and Walmart are building out their own clinics, Walgreens is outsourcing it to companies including VillageMD 

Rick Gates, senior vice president of pharmacy and health at Walgreens, says the company is excited about the potential for this partnership to lower health care costs and increase medication adherence.  

“They are a full service primary-care physician’s office. They are serving patients with chronic care needs, which is one of the highest costs in the health care landscape. They’re serving the patient end to end and they’re investing into at-risk models, where they’re trying to lower costs for payers and employers. And they work closely with pharmacists in their platform. For their platform, the pharmacist is really part of the care team and that helps manage adherence on drug therapy to maximize outcomes,” says Gates. 

For their part, Barry and Clive Fields, MD, VillageMD’s CMO, say they are looking forward to bringing primary care to underserved areas and building connections within the community. Barry and Fields spoke with Health Evolution about the deal with Walgreens, trends that have made retail-based primary care more appealing to patients, the challenges the company is facing as it scales up and more. Below are excerpts from this interview.  

Health Evolution: What does the Walgreens deal mean for VillageMD and what you are trying to accomplish? 

Tim Barry: We’re incredibly excited about the partnership with Walgreens. We rolled out pilot clinics with them in the fall of 2019. To say the clinics have been a smashing success is an understatement. The way we look at success is about the experience patients and doctors are having. Do we see better clinical results? Does it help us continue to push to a better model of delivery, particularly for patients with chronic disease?  

We’re an at-risk primary-care provider, we’re accountable for the cost of care and outcomes for at-risk patients. We know that less than 20 percent of our patients are accountable for 85 percent of the medical spend of all patients. When you look at what’s happened with our chronic patients and the improvements in their medication adherence levels, it’s fair to say it’s been successful. We saw increased medication adherence for patients with hypertensive problems and high cholesterol to a level that CMS uses called the 5-star level. In turn, this led to improved clinical lab values. That was because we had this integration of the primary-care doctor and pharmacist right there working together. From a consumer experience standpoint, we had a net promoter score in these clinics in the low to mid 90s.  

We had physicians who were skeptical at first—they had an image of walking into a Walgreens store going down aisle seven, past the greeting cards to a medical practice in the back. These clinics are vastly different. We bulldoze 30 percent of existing Walgreens and we build a new state-of-the-art clinic. The docs enjoy that space. They love that they and their patients can park easily. They don’t have to park in some medical complex. It’s incredibly convenient to the doctor and patients. And thus far, patients love the experience. 

Clive Fields: The clinics show primary care the kind of respect we typically show to neurosurgeons, surgical oncologists, and others we put at the higher end of the medical academic chain. I was talking to someone the other day about the inconvenience of health care. Is there any other industry that’s been built where we make people take two hours of their day, fight for parking, walk in the heat, go up elevators, wait in a waiting room to spend six or seven minutes with a physician, and many times patients don’t understand what even happened during that transaction?  

By taking these clinics into neighborhoods where people live, we’ve effectively eliminated 75 percent of the time it takes to actually go to a doctor’s office. Some doctors would see that as an opportunity to see three times as many patients. At Village, it gives us the opportunity to see the same patient three times longer. It’s less rushed. There’s less stress in the room. We’ve taken health care to a more consumer-oriented focus. One where we care what happens to the patients inside and outside the exam room. And that’s not just in terms of access and convenience, but our clinical model as well. It’s the ability to take doctors from the office to the home and connect them with patients via telehealth and remote patient monitoring.    

Health Evolution: Why now? This is an ambitious expansion plan in normal times, never mind during a COVID recession.  

Fields: Well we didn’t get a chance to schedule this pandemic, it showed up uninvited. When we look back on this pandemic, a number of things will be revealed. At the top of the list is the underinvestment into primary care. I say that because in the middle of a pandemic, when anxiety is high and chronic disease needs to be managed, there’s not a relationship that’s more important than the one a patient has with their primary-care doctor. We’ve had the worst and best of all worlds: We have the worst situation in terms of morbidity, mortality, anxiety, depression, isolation, loneliness. But what we have to offer are family doctors in neighborhoods where people can be seen in person or telehealth. They know there is a community doctor there for them.  

You may not be old enough to remember the depiction of a physician as Marcus Welby, he was a physician on a TV show in the 1960s. He showed the kind of trust and relationship that drives good outcomes between a patient and a doctor. Our ability to provide that in the middle of a pandemic is somewhat of a blessing and something we’ve embraced.  

Health Evolution: What trends have been happening in primary care that have made retail clinics more appealing?  

Fields: The most common interaction that a patient has with the health care system is with their primary-care doctor. The common intervention in this country for a patient in this health care system is the administration of a drug. Bringing together doctors and pharmacies is a little bit like apple pie and ice cream. They naturally go together because patients converge at those two points. We have traditionally undervalued the expertise and training of pharmacists and bringing that into our model enhances the patient and physician experience. For physicians, because the writing of a prescription is the single most common intervention you offer a patient, the administrative and clinical challenges around that can best be managed in partnership with a pharmacist. We’ve seen doctors spend less time on paperwork and patients get the right medication at the right time more frequently.   

If you’re going to make a difference in people’s health, then make a difference in people’s health that’s not great to start out with. You’re not going to see a VillageMD inside the Olympic training village. That’s not what we do.

Clive Fields, MD

Health Evolution: What challenges are you encountering as you scale up and what others do you anticipate moving forward? 

Barry: Clive and I have been organizing primary-care physicians to value-based arrangements for the better part of 15 years. We’ve done it in urban, suburban, and rural markets across the country. We know that primary care is chronically underinvested in across this country. We know that primary-care physicians when they go into specialties associated with primary care, they enter the field for not purely economic reasons. They go in for the totality of health that it provides you. The beauty of this business we’re in and the model we have is we’re going to markets around the country and finding this exact problem that primary-care doctors face. They feel they’re under-resourced. The tech is not sufficient. They don’t have the ability to extend care beyond the four walls of the exam room. This is a common problem. Part of what’s allowed us to grow at this pace and allowed us to grow more so with our new partnership, is that common problem exists whether it’s Indiana, Arizona, or Montana. That problem exists everywhere. 

The challenge of scaling is less around the heart and mind of the physician. But it’s more around the fact that our starting points are well established physicians who have gotten really good at working in a fee-for-service model. It takes a little bit of time. It takes two years for them to get completely acclimated to a nurse care manager, a social worker, and a pharmacist who are now part of their care team. It’s like anything else. If you’re living alone and suddenly have three roommates, you have to think about living differently. In this case, physicians get acclimated to these other resources once they realize the value and potential of the data and technology we bring to bear and the value of these other team members. Once that happens, you see a whole different level of magic.  

The challenge is that you don’t know what will happen two years down the road, but it takes a little bit of time for the physician to acclimate and the staff to get trained. You’re asking people to things they haven’t done historically. We will open 50+ clinics in 12 months. That’s only about 200 doctors. That’s half of the growth we’re going to experience this year alone. We’re trying to grow in a smart, thoughtful way because we don’t want to let growth get in the way of a maniacal focus on creating a better experience for patients and doctors.   

Health Evolution: How do you choose which markets to expand into? 

Fields: Over half of these locations will be built in medically underserved areas. If you’re going to make a difference in people’s health, then make a difference in people’s health that’s not great to start out with. You’re not going to see a VillageMD inside the Olympic training village. That’s not what we do. Other health care providers do that and they do that well. When we look for markets, we’re looking for patients who need access to better primary care.    

Barry: There are 36-plus markets that we’ve identified as good markets to be in. They have pretty good-sized populations. The next 500-700 clinics we do with Walgreens is just a start. It’s not the final number that we’re building together or that we’ll build above and beyond that will not be at a Walgreens store. From that standpoint, we’re looking at markets where there’s been an underinvestment in primary care and a huge opportunity to bring a different type of primary care into that market. Once we dive into those markets, we identify significant portions of the population that are on Medicaid or Medicare but not getting their needs met by the health care system. We’re identifying those and building primary-care clinics there. As we’re starting to reveal where these locations are, we go out to the local communities, we go to the churches, the senior centers, and those kinds of areas, and we’re seeing incredible excitement.    

Health Evolution: What is your advice to health care CEOs who are dealing with the disruption of primary care?  

Barry: The conversations among health care leadership across the board should be “what are we doing to provide the best care we possibly can for patients with chronic disease?” If we’re allowing organizations to focus their energy exclusively on surgical specialties or building more hospitals, that’s not solving the problem. Solving the problem is prevention and solving the problem is recognizing those with chronic disease need to be treated in a much more holistic way that’s beyond the four walls of an exam room. They need to be treated in a way that incorporates technology, care in the home and with a comprehensive model that focuses on solving the patient’s problems.  

About the Author

Gabriel Perna, Senior Manager, Digital Content

Gabriel Perna is the Senior Manager of Digital Content at Health Evolution. He brings 10+ years of experience in covering the intersection of health care and business. Previously, he was at Chief Executive, Physicians Practice and Healthcare Informatics. You can reach him via email or on Twitter at @GabrielSPerna