Radio Advisory's Rachel Woods sat down with Walgreens Health Chief Clinical Officer Dr. Sashi Moodley to discuss the obstacles of being a disruptor in a crowded competitive field, building longitudinal relationships with patients instead of transactional, and Walgreens’s goal of becoming an equal player in the value-based care industry.

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Read a lightly edited excerpt from the interview below and download the episode for the full conversation.

Rachel Woods: People think of Walgreens and they think of that vaccine clinic, they think about something that's certainly accelerated and grown in the context of Covid-19, but they think of it as a place to get their drugs, be a little bit of a corner market, maybe get a vaccination, but that is very different from the vision of Walgreens Health. What is Walgreens Health mean right now, and what's the vision for the future?

Sashi Moodley: So Walgreens Health was announced back in October of 2021 and it really allowed us to realize our vision of becoming more of a health care destination. To your point, I think historically we've done some of the things you've talked about, vaccines and testing, and that'll still be a core part of our strategy, but there's a lot more that we can do. I think Covid really demonstrated the value that we bring to the health care ecosystem more broadly across the country.

So Walgreens Health is the new growth engine of the company where a lot of our newer assets that we've invested in or that we're building our position. So that includes for example, Village MD, which is a primary care company that we invested in and they're going to be building out primary care clinics across our stores, across the country.

There's also some other companies that we have under that umbrella like Carecentrix that focuses on patients during the post acute care period and so it really is an effort for us to bring together a portfolio of companies to help manage a patient and orchestrate that care journey for them.

Woods: And to be that health care destination.

Moodley: Yes.

Woods: I want to talk about some of the specific investments that are underneath the umbrella of Walgreens Health. And you mentioned one of them already, which is Village MD. You all are the first national pharmacy chain to offer full service primary care with both PCPs and pharmacists in the same location. I think you have a goal of getting to, what is it, 200 clinics by the end of 2022?

Moodley: Yeah, that's correct. 200 by the end of 2022, and we've also said that we want to get to a thousand at scale.

Woods: Wow. So what does the Village MD partnership and the investment in primary care do for that vision for Walgreens Health?

Moodley: I think it gets back to where we want to go and what traditionally we've done. I think it gets to the point of becoming more of a longitudinal partner, being that kind of health care destination, not just for more transactional type services, but really that longitudinal relationship-based care.

So that's what investing in primary care allows us to do, and when you integrate the pharmacy model into primary care, we think there's a ton of value that can be created. Something that I learned when I joined here was the power of the patient pharmacist relationship and how much trust there is there. It's something that I didn't actually recognize until I came to the company.

Woods: Well, as a physician, you often think the relationship lives with me and it's the patient doctor relationship, but you're describing that people can have deep trusting relationships with other members of the care team, including the pharmacist.

Moodley: Exactly the patient PCP relationship is extremely strong, but I didn't recognize that relationship with a pharmacist and how important that was. Now I hear stories all the time of how patients tell our pharmacist things that they don't even tell their primary care doc, and we have seniors who come to our stores 10 to 20 plus times a year to meet with their pharmacist, to pick up their medication. That's a lot more engagement that they're getting with their primary care doctor.

So it's no surprise that they know these pharmacists so well and the pharmacists know these patients so well, as well. That we think by combining that pharmacists model with the primary care model, there's a ton of value that we can create and positively impact the patient.

Woods: It makes sense for this longitudinal relationship—let's not just meet with somebody once or twice a year, we want to meet with them 10 plus times—but it does strike me that these are physical sites, these are in person primary care clinics.

I know that you're targeting those, or I think, at least a majority in medically underserved areas, but this is happening at the same time that the industry is pushing more care closer to the home, not just at say a co-located facility, but to digital solutions, to more home-based care, to more remote patient monitoring. What's the balance of in person care and virtual care for Walgreens Health?

Moodley: So even if you take a step back and look at Village themselves, they have a very robust home-based care program. So I think we typically think of them as the brick and mortar facility based care, but they have a robust team that sees patients, often those patients that are too frail to come in to the clinic, they see them in their homes.

When you consider the portfolio of assets that we have under Walgreens Health, we have a company that's really focused on home-based care, which is Carecentrix and that transition from when a patient moves from the hospital to the nursing facility, to the home, they're really focus on the patient during that episode. So we do see the care model very broadly. It's not just that in person component, but it is also virtual care, and in the home.

On the virtual care front, we are making investments in building out our capabilities, whether it's for remote patient monitoring or telemedicine, to be able to incorporate that into the care model. So it's definitely all of the above.

Woods: Well, it sounds to me like the business strategy is, Walgreens is basically trying to rebuild the delivery system and is looking to partners that do different aspects of care delivery very well, whether it's that longitudinal patient relationship, whether it's the brick and mortar, whether it's the virtual and the remote patient monitoring and they're trying to say, "What companies, what partners can we bring under this umbrella so that we can rebuild the delivery system?"

Moodley: If you look at our mission, we want to be the leading partner in reimagining local health care. We know we're not going to do all of this ourselves. We're looking for partners to help us orchestrate that journey for the patient.

But what do we have that we can offer that's really differentiated? 9,000 locations across this country. Close to 80% of the population lives within five miles of one of our stores and millions of people interact with us on a daily basis. So it's an incredible platform for us to be able to engage patients and impact their care beyond what we're doing now. But we know we're going to have to work with partners to realize that vision, we're not going to be able to do everything ourselves.

Woods: So you mentioned Village MD and you mentioned Carecentrix. There's another partner that I know that you work with, and I'm not sure that I understand the distinction between it and some of the other assets. That is the Health Corner, what is the difference between a Health Corner and say a Village MD clinic?

Moodley: So the Health Corner is something that we're building organically. It's not an external partner. It's something internal that we're building. To understand the Health Corner, you need to look again at our scale, 9,000 stores.

With Village, what we mentioned is that we're going to build out a thousand locations, that still leaves 8,000 stores where we're not going to have primary care, but that doesn't mean we can't do more than what we're doing today in the health care services space. So the Health Corner is a channel of engagement for us to deliver additional clinical programs through, and what we've said is we want to build up to 3000 of these across the country because we're a big company and to be able to move the needle, we know that we're going to have to leverage our footprint at scale to be able to do that.

So the Health Corner, it's core to our strategy, but what I would say about the Health Corner is that the way that it looks today, it is not going to be the model that it has to be as we scale it. Because again, it's a channel of delivery.

So what really is important is what programs are we delivering to which patients and that'll determine what the Health Corner looks like, just like we had talked about the virtual space in the home, it's a channel of delivery.

More importantly is what are we trying to deliver through that channel? And that'll determine who sits in the Health Corner or what the Health Corner actually looks like from an experienced standpoint.

Woods: But it's interesting to me that it also is a sentiment of what is Walgreens not doing. You did not say we are going to build, establish, create 9,000 Village MD locations. The goal is a thousand, which is substantial, and then it's, "What else can we do to fill gaps in the other 8,000 stores?" Maybe it's something that looks a little bit different. That's a deeper version of that pharmacist relationship that has a technological backbone, but doesn't mean you're building 9,000 primary care offices.

Moodley: Yeah, exactly. If you look at where we're building most of these sites and at least 50% of them are going to be built in medically underserved area.

So when you look at our footprint, not all of them would justify having a full primary care service in them. But again, that doesn't mean we can't do more in those sites to help patients along their care journey. We're not trying to compete with primary care, with the Health Corner. It's really around providing wraparound services to complement the services that those patients are already getting from their primary care physicians. Because we know that currently, if you look broadly, patient outcomes and quality isn't improving at the same rate at which costs are going up.

So there is a tremendous opportunity there to provide some wraparound services and complimentary services to really get patients on track from a disease management perspective.