Reference no: EM133529354

Case Study: Woolworths is getting into telehealth - but patients need to be treated as more than customers, By Jon Wardle and Aime Steel, March 24, 2023, The Conversation

Earlier this week, Australian retail giant Woolworths announced a move into healthcare delivery via development of its subsidiary HealthyLife's online portal.

Through this portal, Australians can book a same-day 15-minute virtual GP appointment for A$45 and have any resulting prescription filled and delivered to their home. They can access other services such as a 30-minute virtual appointment with a dietitian or nutritionist for $115. They can also access free 15-minute virtual consultations with naturopaths.

Accessibility has long been an issue in Australian primary health care. With wait times for GPs growing, same-day appointments are becoming almost impossible.

But when a business provides both health advice and therapeutic products for sale, it raises ethical and regulatory questions.

Modern life and medical appointments

Lots of people have difficulties with the logistics and time constraints of having to get to a physical location for an appointment. While the rapid move to telehealth appointments has given many Australians a taste for it, health policy and implementation has largely lagged behind.

"One-stop-shops" that offer health services, advice and information can serve as valuable tools to boost self-care. Yet there are some issues when these services are led by or become dominated by corporate players such as Woolworths.

Both prescriber and dispenser

Through Woolworths' proposed model, the same company will be both prescriber and provider of pharmaceutical medications, food products and over-the-counter medicines and supplements. Woolworths' subsidiary HealthyLife extended its partnership with SuperPharmacy late last year and rebranded it.

The direct-to-consumer and vertically integrated nature of this arrangement creates significant potential for commercial conflicts of interest.

It is also interesting to note that, unlike the other appointments available through the Woolworths' clinical partners, naturopathic appointments will be offered for free. These will be provided by in-house naturopaths employed by Woolworths.

Naturopaths have been actively included into corporate health promotion initiatives and health systems overseas. These programs and initiatives suggest potential benefits from naturopathic care. While Australia has one of the world's highest rates of consultations with a naturopath, health systems here have been slow to embrace their inclusion. Out-of-pocket costs also remain a barrier to access for people on lower incomes.

But Woolworths isn't launching this initiative out of altruism - it has identified a clear market gap it thinks it can fill and is meeting a growing and unmet public demand for these services.

'Medical merchants'

Under Woolworths' plans, GPs, dietitians, and nutritionists will be engaged through partner networks rather than as direct employees. But naturopathic appointments will be delivered by in-house practitioners, employed by the same arm of Woolworths that sells natural health products.

These will also be the only appointments available to consumers for free. This may make them the most attractive option for many consumers. But it could also make these the appointments with the fewest safeguards if not handled correctly.

For example, will products accessible via Woolworths be prioritised over products from elsewhere that may be the best for the patient? The proposed model could take this problem from individual clinicians to an institutional issue operating on a much grander scale.

Supplements are not in the five most recommended treatments in Australian naturopathic appointments. Rather, naturopaths have been shown to most commonly (and effectively) prescribe non-pharmacological dietary, lifestyle, exercise, and self-care advice to their patients.

But there is a valid concern that the shorter than usual naturopathic appointments to be offered by Woolworths could prioritise supplement recommendation over these options.

Working for Woolworths

It remains unclear as to whether the naturopaths employed by Woolworths will have the necessary autonomy to provide this comprehensive form of care.

Will they be encouraged to "de-prescribe" unnecessary supplements as well as prescribe necessary ones? Will they be supported if they recommend a non-product dietary intervention as a more effective option than specific nutrient supplementation?

Collaborative arrangements between employed practitioners and Woolworths' clinical partner networks also remain unclear. Will an employed naturopath be able to refer to other practitioners if needed? Will these referrals be limited to Woolworths' clinical partners? Fragmentation and under-treatment of potentially serious conditions could result if such issues aren't transparently addressed.

The employment situation itself also raises potential legal and regulatory issues. If an employer sets product sales targets for a practitioner (and it should be noted there is no indication Woolworths is doing this), who is responsible if this results in inappropriate over-servicing or over-prescribing?

And of course, efforts need to be made to ensure any practitioners delivering the naturopathic appointments for Woolworths are appropriately qualified. For a profession such as naturopathic medicine - which remains an unregistered profession despite every government review of the past two decades recommending registration - the onus will be on Woolworths to ensure proper standards of qualification and practice among their practitioners.

Filling the gaps

The Australian health system has been traditionally slow to innovate and reform to meet the needs and demands of modern consumers. In this context, the private sector will increasingly view these gaps as commercial opportunities.

In some cases, the innovation in delivery and improved accessibility could bring health benefits. But we need to ensure the private sectors' increasing interest in health service delivery is matched by increased accountability and safeguards, including targeted regulation if appropriate.

As corporations increasingly become involved in delivering health care innovation, we need to make sure the private sector views the people using health services as patients, not just pay cheques.

Question:

Question 1a) Woolworths has identified "a clear market gap it thinks it can fill" via its HealthyLife brand. Profile a target market that exists for the HealthyLife service, including its demographic, psychographic, geographic and/or behavioural characteristics. Question 1b) Justify your selection of this target market and outline a positioning strategy for this target market.

Question 2a) Outline the inherent characteristics of services (versus goods) and their marketing implications for HealthyLife's telehealth offering. Question 2b) HealthyLife is part of the Woolworths' Group. Evaluate this brand extension based on your knowledge of brand strategy.

Question 3) Outline the likely internal/psychological and external/sociological factors that would influence a consumer's decision to adopt a same-day 15-minute virtual GP appointment via HealthyLife.

Question 4) Recommend and justify an integrated marketing communication mix to promote HealthyLife's offering to the target market that you identified in Question 1.