April 1, 2009
Walgreens to Take Care of Some Unemployed for Free
Walgreens is the latest company to offer
customers some protection in the event of a job loss. The company announced
it would offer free visits to its in-store Take Care health clinics for
existing customers without health insurance should they lose their jobs
after March 31. The "Take Care Recovery Plan," as it is being
called, would extend coverage to spouses, domestic partners and children
of the unemployed customer if no insurance coverage is in place for those
individuals.
Gregory D. Wasson, president and chief executive
officer of Walgreens, said in a press release that the company would "not
stand idly by as individuals are forced by the hardships of the economy
to choose among basic necessities such as health care, housing and food.
Quality, accessible and affordable care should be the right of every individual."
A typical visit to a Take Care clinic usually
runs between $59 and $80 for the uninsured. The company operates 330 in-store
clinics and 370 others at work sites around the country.
A nurse practitioner who works for Take
Care Clinics, Kate Gerges, told The Columbus Dispatch that it will
take 21 days to verify an individual’s eligibility to participate in the
program.
Quest Diagnostics announced it would support
Walgreens’ initiative by providing free laboratory testing on certain lab
tests including strep and urine samples.
"Quest Diagnostics recognizes that
many American families are struggling to afford quality laboratory testing
services during the current economic downturn," said Steve Burton,
vice president, Health and Wellness Services, Quest Diagnostics, in a press
release. "Our participation in the Take Care Recovery Plan will help
more patients to access our laboratory testing services. We look forward
to participating in the Take Care Recovery Plan, which will extend the
range of financial assistance programs Quest Diagnostics has long provided
to patients grappling with financial hardship."
Walgreens did not disclose how much offering
free medical service to its unemployed clinic customers would cost. Hours
for free service are limited from 11 a.m. to 3 p.m. Monday – Friday.
Robert Summers, an analyst with Pali Research,
told Reuters, the planned appeared to be "a rather expensive
way to drive awareness of the company’s in-store healthcare clinics."
Discussion Questions: Will the "Take
Care Recovery Plan" work out to benefit both Walgreens and its unemployed
customers? Do you see any potential for backlash or could the program
prove too costly for Walgreens?
- Walgreens and Take Care Health Systems Announced Offer
of Free Health Care Services for Families That Suffer Job Loss and Have
No Health Insurance – Walgreens/Take Care Health Systems - Quest Diagnostics to Support Walgreens
and Take Care Health Systems’ Offer of Free Health Services by Providing
Certain Free Laboratory Testing – Quest Diagnostics Incorporated/PRNewswire-FirstCall/FOX
Business - Walgreen offers some unemployed free
clinic trips
– Reuters - Walgreens clinics to offer free care
to existing patients who lose jobs, health insurance – The Columbus
Dispatch
BrainTrust
Recent Discussions
Discussion Questions
Poll
I’m sure Walgreens considered the bottom-line implications before making this decision, which could have some short-term risk. On the other hand, the program does drive traffic into Walgreens stores; Walgreens must assume in its business models that those customers will buy other merchandise while in the store. (The price paid by the uninsured for prescriptions other than generics is another story.)
Most importantly, the PR and goodwill created by this should drive consumer loyalty over the long run, and not just among beneficiaries of the program.
I think this is a great customer service gesture from Walgreens and may actually help build up their business. Health care is such a bone of contention and when you add no job to that, you have a very dire situation for customers.
Walgreens has always been a leader in retail health care and this move will solidify that position. This program must be monitored for cost controls. As nice as the idea is, we don’t want to bankrupt ourselves by giving away the store. I would definitely optimize merchandising in and around the clinics to better shield against the onslaught of free services. As a manager, if I see pockets of high traffic, I’m moving bins and quads no matter the reason!
The fact that the unemployed’s visits are limited to certain hours, 11 to 3, suggests that this is the slowest time at the clinics. It also suggests that Walgreens has thought through the cost impact of servicing those who have lost their jobs. Clearly, there is much down time from 11 to 3 where, despite lack of clients, the costs remain. In addition, a 21-day verification process may keep more people out of the program than those that actually participate.
Assuming that Walgreens has minimized the incremental cost impact, it certainly adds a large halo to a retailer with a less than commendable profile. But, that halo is not likely large enough.
As a form of loyalty program, this should have benefits with those who use the service (and hopefully will return to paying status within a reasonable period) and the general community of Walgreens customers. It also has benefit as a corporate goodwill effort. Not to be forgotten, of course, is that it benefits those who don’t have insurance which could be significant for those individuals. Given the cost of healthcare and the focus on healthcare providers as having burdened all of us with excessive costs, a bit of goodwill is not a bad thing.
A 21-day waiting period when a person needs immediate help (basically the profile of patients going to in-store clinics) is likely to upset the jobless who haven’t read the fine print and think Walgreens has promised to Take Care of their problems for free. Walgreens’ intentions may be good but you know what they say about good intentions.
There seem to be enough terms and conditions attached that Walgreens is not likely to lose money but may gain customers and loyalty (amongst paying customers as well for the good deed they’re doing) while making the most of what may be downtime during the middle of the day. Between this and their recent participation in Earth Hour, I would make them my drugstore of choice if I lived near enough.
I don’t see much of a downside. These nurse practitioners don’t seem to be all that busy when I go into Walgreens. Walgreens is paying them to sit around and wait for a patient to come in. So why not keep them busy working with the unemployed? Maybe it will help drive a little business.
Image over substance on this one. As noted, the 21 day period is exclusive, not inclusive. While a nice gesture, it may backfire. An unemployed customer is frustrated enough. When they realize that they can’t get care right away; how much more frustrated will they become?
It’s sort of like their unemployment check. It’s in the mail. We’ll get to your cold in 21 days? Tough it out and if you get sick again in three weeks–we’re here for ya buddy!
I wonder if Rick Wagoner will be signing up?
Carefully calculated PR move? You bet.
Chances of backfiring? High.
Reason? The press won’t forget this one after the announcement. One followup story about customers disgruntled by the limitations may very well land Walgreens in the headlines–not in a good way. In this case, following through to the letter of the program (which will no doubt minimize program costs considerably) is likely to result in customer dissatisfaction–deserved or not–that will extract a far greater cost in the market. On the other hand, if Walgreens follows through in a way that gets customers singing their praises, this could result in a very well-timed home run.
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I’m sure Walgreens considered the bottom-line implications before making this decision, which could have some short-term risk. On the other hand, the program does drive traffic into Walgreens stores; Walgreens must assume in its business models that those customers will buy other merchandise while in the store. (The price paid by the uninsured for prescriptions other than generics is another story.)
Most importantly, the PR and goodwill created by this should drive consumer loyalty over the long run, and not just among beneficiaries of the program.
I think this is a great customer service gesture from Walgreens and may actually help build up their business. Health care is such a bone of contention and when you add no job to that, you have a very dire situation for customers.
Walgreens has always been a leader in retail health care and this move will solidify that position. This program must be monitored for cost controls. As nice as the idea is, we don’t want to bankrupt ourselves by giving away the store. I would definitely optimize merchandising in and around the clinics to better shield against the onslaught of free services. As a manager, if I see pockets of high traffic, I’m moving bins and quads no matter the reason!
The fact that the unemployed’s visits are limited to certain hours, 11 to 3, suggests that this is the slowest time at the clinics. It also suggests that Walgreens has thought through the cost impact of servicing those who have lost their jobs. Clearly, there is much down time from 11 to 3 where, despite lack of clients, the costs remain. In addition, a 21-day verification process may keep more people out of the program than those that actually participate.
Assuming that Walgreens has minimized the incremental cost impact, it certainly adds a large halo to a retailer with a less than commendable profile. But, that halo is not likely large enough.
As a form of loyalty program, this should have benefits with those who use the service (and hopefully will return to paying status within a reasonable period) and the general community of Walgreens customers. It also has benefit as a corporate goodwill effort. Not to be forgotten, of course, is that it benefits those who don’t have insurance which could be significant for those individuals. Given the cost of healthcare and the focus on healthcare providers as having burdened all of us with excessive costs, a bit of goodwill is not a bad thing.
A 21-day waiting period when a person needs immediate help (basically the profile of patients going to in-store clinics) is likely to upset the jobless who haven’t read the fine print and think Walgreens has promised to Take Care of their problems for free. Walgreens’ intentions may be good but you know what they say about good intentions.
There seem to be enough terms and conditions attached that Walgreens is not likely to lose money but may gain customers and loyalty (amongst paying customers as well for the good deed they’re doing) while making the most of what may be downtime during the middle of the day. Between this and their recent participation in Earth Hour, I would make them my drugstore of choice if I lived near enough.
I don’t see much of a downside. These nurse practitioners don’t seem to be all that busy when I go into Walgreens. Walgreens is paying them to sit around and wait for a patient to come in. So why not keep them busy working with the unemployed? Maybe it will help drive a little business.
Image over substance on this one. As noted, the 21 day period is exclusive, not inclusive. While a nice gesture, it may backfire. An unemployed customer is frustrated enough. When they realize that they can’t get care right away; how much more frustrated will they become?
It’s sort of like their unemployment check. It’s in the mail. We’ll get to your cold in 21 days? Tough it out and if you get sick again in three weeks–we’re here for ya buddy!
I wonder if Rick Wagoner will be signing up?
Carefully calculated PR move? You bet.
Chances of backfiring? High.
Reason? The press won’t forget this one after the announcement. One followup story about customers disgruntled by the limitations may very well land Walgreens in the headlines–not in a good way. In this case, following through to the letter of the program (which will no doubt minimize program costs considerably) is likely to result in customer dissatisfaction–deserved or not–that will extract a far greater cost in the market. On the other hand, if Walgreens follows through in a way that gets customers singing their praises, this could result in a very well-timed home run.