Walgreens sells 11 VillageMD clinics to Arches Medical Partners
For Arches, the move establishes its presence in the Providence, Rhode Island, metro area.
Photo: Courtesy of Walgreens
Walgreens has sold 11 VillageMD clinics in Rhode Island to Arches Medical Partners, a Boston-based medical group management company.
Terms of the transaction remain private, Arches said.
WHY THIS MATTERS
Walgreens has been unloading VillageMD primary care clinics to increase profitability.
In October, the company announced it would implement a cost-saving strategy to save $1 billion after it posted weaker-than-expected 2023 fourth-quarter earnings.
The strategy included closing roughly 60 VillageMD clinics the company deemed as underperforming.
Contributing to the decision was a soft profit outlook for 2024 amid falling demand for COVID-19 vaccines and testing in the U.S. and lower consumer spending.
Last year, VillageMD closed 14 of its 52 clinics in Florida and this year has left the Florida market.
For Arches, the move establishes its presence in the Providence metro area.
AMP now employs 50 PCPs and operates eight office locations and three urgent care centers in Rhode Island. AMP said it is owned and advised by physicians in Independent Practice Associations.
AMP deploys its wholly owned technology subsidiary, New Era Medical Operations (NEMO) software, to enable IPAs to negotiate and manage global risk contracts. The company said it actively seeks practices aligned with the shift from fee-for-service to global risk contracting for patients covered by commercial, Medicare and Medicaid plans.
Arches CEO Dr. Chris Kryder, along with partners Todd Stockard, Dr. Manoj Mathew and Carlos Rivera, formed Arches Medical Partners in 2023.
THE LARGER TREND
Walgreens operates nearly 9,000 retail locations across America, Puerto Rico and the U.S. Virgin Islands. VillageMD currently operates Village Medical, Village Medical at Home, Summit Health and CityMD in an estimated 26 markets.
In 2022, VillageMD acquired Summit Health-CityMD through an investment from Walgreens Boots Alliance and Evernorth, the Cigna subsidiary.
ON THE RECORD
"We all know how broken the system is. Arches Medical is looking for PCPs who want better options for themselves and for their patients," Kryder said. "We are excited about establishing new solutions for our patients and creating this nucleus of primary care in Rhode Island. We expect to grow organically and quickly."
Email the writer: SMorse@himss.org
