Wal-Mart chief executive and president Lee Scott said Wednesday, January
23, that the retailer plans to deepen its involvement in health care by
contracting with employers to help them reduce prescription drug costs.
In an address to more than 7,000 store managers and suppliers gathered in
Kansas City, Missouri, for the company’s annual start-of-the-year meeting, Scott
says the company would redouble its efforts to improve the efficiency and reduce
costs in health care, make environmental-friendly technologies affordable to
customers and businesses, and exert greater pressure on its supply chain to meet
higher ethical standards in the way it produces goods.
But it is in the area of health care that Scott believes Wal-Mart can have an
immediate economic impact on employers across the U.S. that are struggling with
the cost of health care. Building on its program to introduce $4 prescription
drugs, Wal-Mart will focus on the confluence of technology and pharmacy
benefits.
“This year we will be contracting with select employers in the U.S. to help
them manage how they process and pay prescription claims,” he said in the text
of his speech. “Our approach will be based on taking out unnecessary costs while
providing high-quality health care products and services.”
Scott says Wal-Mart will save its employer customers $100 million this
year.
The company plans to launch an initiative that will quadruple the number of
electronic prescriptions filled by Wal-Mart in the U.S. to 8 million by the end of the
year.
Without naming it, Scott mentioned the company’s involvement in a project to
create electronic medical records for its employees. The Dossia project,
launched in late 2006 by Wal-Mart, Pitney Bowes, BP, Intel and Applied
Materials, was set back by a contract dispute with its original service
provider, Portland, Oregon-based Omnimedix.
In September, Dossia announced it
would start over with a new technology provider, the Children’s Hospital
Informatics Program based at Children’s Hospital Boston, which has developed a
personal health record called Indivo.
On Wednesday, Scott reiterated the company’s commitment to medical records,
and said the company will provide the records to employees, retirees and their
dependents by 2010.
Scott’s speech came a day after the company touted in a press release its
efforts to insure more of its employees. The company said half its 1.1 million
employees had health insurance through Wal-Mart and that in the past year the
number of uninsured employees declined by 2.3 percent.
Burdened by bad publicity and public backlashes in locations across the
country, Wal-Mart has made a concerted effort to improve its image in recent
years.
The start-of-the-year meeting was open to outsiders for the first time on
Wednesday. The speech, titled “The Company of the Future,” was an update on
Scott’s vision laid out in his 2005 “21st Century Leadership” speech. Some
critics of the company, like the group Wal-Mart Watch, said the retail giant had
not made enough progress since then, while others, like the Natural Resources
Defense Council, praised the company for embracing its role as a global leader
with the economic leverage to make other companies and industries embrace an
ethos that pairs cost efficiency with environmental sustainability.
—Jeremy
Smerd