This Wednesday, May 15, 2013, photo, shows frozen yogurt machines at the Walgreens flagship store in the Empire State Building, in New York .The nation’s major drugstore chains are opening more in-store clinics in response to the massive U.S. health care overhaul, which is expected to add about 25 million newly insured people who will need medical care and prescriptions, as well as offering more services as a way to boost revenue in the face of competition from stores like Safeway and Wal-Mart. (AP Photo/Mark Lennihan)
At some Walgreen stores, there are health clinics staffed by nurse practitioners, cafes that sell barista-prepared coffee and Eyebrow Bars where trained professionals groom unruly facial hair.
Oh, and pharmacists fill prescriptions, too.
The nation’s major drugstore chains are moving beyond simply doling out drugs and Kleenex. They’re opening more in-store clinics and offering more health care products in part to serve an aging population that will need more care.
It’s also a response to the massive U.S. health care overhaul, which is expected to add about 25 million newly insured people who will need medical care and prescriptions. And drugstores are offering more services as a way to boost revenue in the face of competition from retailers like Safeway and Wal-Mart that have added in-store pharmacies.
Beth Stiller, a divisional vice president at Walgreen, the nation’s largest drugstore chain, said the changes are necessary because time-pressed customers have come to expect that they will be able to do more than just fill a prescription at drugstores.
“We live in a world where personalization and … high-touch service is much more expected,” agreed Helena Foulkes, chief health care strategy and marketing [auth] officer for CVS Caremark Corp., the nation’s No. 2 drugstore chain.
The move toward expanding products and services has been gradual. Up until about five years ago, the major drugstore chains focused on adding stores, not services. Then when states started allowing pharmacists to provide flu shots, it paved the way for drugstores to begin offering other immunizations for diseases like pneumonia and shingles.
And after Congress passed the health care overhaul in 2010, drugstores started adding more in-store clinics to help serve the newly insured population that will be created by that law. At the same time, grocers and other big retailers have started beefing up their health care offerings to compete with pharmacies for customers.
For instance, Safeway Inc., which runs more than 1,600 stores under the Safeway and Vons names, is adding private rooms in some stores to make its pharmacists more accessible. It also is adding products that focus on a customer’s health and well-being, such as health food or goods for a specific diet, like gluten-free products.
Steven A. Burd, the grocer’s recently retired chairman and CEO, told investors earlier this year that he believes “Safeway can own the wellness space.”
“It became a marketplace where everybody was doing a little bit of everybody else’s stuff,” said Jack Horst, a partner with the management consulting firm Kurt Salmon. “There are so many other options for people these days in terms of finding an outlet for filling a prescription.”
So drugstores are expanding their offerings to stay competitive. Rite Aid Corp., the nation’s No. 3 chain, has converted more than 900 of its 4,615 locations to a “wellness” format it introduced in 2011. The stores offer organic soups, pastas and juices and a line of home fitness equipment like yoga mats and dumbbells that Rite Aid helped design.
They also feature employees equipped with iPads to find and print coupons for customers, look up information on vitamins or enroll them in services like automated pharmacy refills.
Additionally, Rite Aid started a program in March that allows customers at about 70 of its stores to connect remotely with doctors for a video or phone consultation covering a range of ailments from allergies to the flu. The 10-minute virtual consultations with physicians, who are contracted by Rite Aid, cost $45. That compares with the more than $100 someone without insurance could pay for a doctor visit.
Rite Aid competitor, CVS Caremark, runs more than 650 MinuteClinics that are staffed by nurse practitioners or physician assistants and handle largely minor illnesses like pink eye. CVS also offers acne consultations and monitoring of chronic conditions such as diabetes. The company aims to operate about 1,500 MinuteClinics by 2017.
“We really see ourselves as a pharmacy health care company,” said Foulkes, the CVS executive.
The chain, which has more than 7,500 stores, also has introduced an urban store format stocked specifically for the needs of nearby customers at about 450 locations. That means providing more space for diapers and household products in areas where there are fewer grocery stores. These stores also peddle “grab-and-go” meals like sandwiches and salads for customers who treat their locations more like a general store.
For its part, Walgreen Co. has opened 11 flagship stores across the country that offer extras like the barista-prepared coffee, juice and smoothie bars, and boutiques that provide services like eyebrow grooming and advisers who dole out information on beauty products. Some even come with humidors to hold cigar collections.
These stores tend to be located in high-profile spots like New York’s Empire State Building. And they’re nearly twice the size of a typical, 14,000-square foot drugstore.
Walgreen also is expanding the scope of the small clinics it has in the back of hundreds of its stores to include the diagnosis, treatment and monitoring of chronic diseases like diabetes that are typically handled by doctors. These clinics, which are usually staffed by nurse practitioners or physician assistants, already handle more basic care like the CVS clinics.
More broadly, Walgreen has launched a “Well Experience” format in about 400 of its more than 8,000 stores nationwide. These stores feature expanded beauty options, fresh food and groceries, private rooms for pharmacist consultations and, in some cases, an iPad-toting employee to help customers.
Walgreen started its “Well Experience” format in late 2010 and redesigned its stores to make room for the consultation room for pharmacists, who also are more accessible when they’re not in the room. They sit behind a desk instead of behind a counter. The company has since redesigned most of its Indianapolis locations to test the concept.
Tina Panyard, who shops at a Walgreen store in Indianapolis at least twice a week, likes the new products and services at the store. She said the containers of fruit and the salads give her a healthier option than McDonald’s — at about the same price.
“We love that Walgreen has this new fresh food, quickie stuff,” she said.