Why Wal-Mart is getting into the health insurance game

 Wal-Mart is taking one-stop shopping to another area: health insurance.

The world's largest retailer plans to work with DirectHealth.com, an online health insurance comparison site and agency, to allow shoppers to compare coverage options and enroll in Medicare plans or the public exchange plans created under the Affordable Care Act.

The strategy is another step into insurance marketing as the retailer tries to use its mammoth size to expand beyond food and other basics at a time of sluggish traffic and sales. It also could help Wal-Mart compete with drugstore chains such as Walgreen and CVS, which are rapidly adding health care services.

“Walmart has long been known for innovation in health and wellness, and we’ll never stop delivering new products and services to the 140 million people who visit our stores each week,” said Labeed Diab, senior vice president and president, Health & Wellness, Walmart US, in a press release “For years, our customers have told us that there is too much complexity when it comes to understanding their health insurance options. Healthcare Begins Here addresses that complexity by bringing clarity and increased choice to the insurance enrollment process through DirectHealth.com.”

Customers can enroll online, by phone or at 2,700 of Wal-Mart's more than 4,000 stores, starting Oct. 10. The stores will be staffed with independent insurance agents from DirectHealth.com.

In April, Wal-Mart teamed up with Autoinsurance.com to let shoppers quickly find and buy insurance policies online. DirectHealth.com and Autoinsurance.com are owned and operated by Tranzutary Insurance Solutions LLC, a subsidiary of Tranzact of Fort Lee, New Jersey, which set up Tranzutary specifically to work with Wal-Mart.

Wal-Mart won't receive commissions on health coverage sales and hopes to benefit partly by luring customers into stores. DirectHealth is absorbing most of the costs to operate the program, Labeed Diab, senior vice president and president of Wal-Mart's health and wellness division, told The Associated Press.

Wal-Mart plans to launch a TV, radio and in-store promotions campaign this month.

Since 2005, Wal-Mart has hosted health insurance agents from individual insurers in stores to field questions and enroll customers. But Diab said that with the Affordable Care Act, shoppers found the search for coverage more complicated.

He cited outside research that shows that more than 60 percent of people have difficulty understanding their health insurance options and nearly 40 percent feel they picked the wrong plan after enrollment.

"We saw a greater need to bring more transparency and simplicity," Diab said. He noted the strategy is also part of Wal-Mart's strategy to build business in wellness and health care. But he also is counting on the program to bring more customers to the store.

"The more we can broaden the assortment, the more we can educate our customer, the better off we will be," he added.

As part of Wal-Mart's expansion into health care, it is testing 11 health care clinics run by Wal-Mart itself that offer primary care such as health screenings and management of chronic conditions like diabetes. That's different from its 100 leased health care clinics in its stores that focus on basic services like flu shots.

The health insurance program works this way: For customers over 65, DirectHealth.com offers access to more than 1,700 plans from 12 carriers including Aetna, Cigna, Humana and UnitedHealthcare during the Medicare open enrollment period from Oct. 15 through Dec. 7.

For customers under age 65, DirectHeath.com offers access to thousands of health exchange plans from more than 300 carriers. That open enrollment period is Nov. 15 to Feb. 15.

The complete offerings are as follows:

For customers over 65:

• DirectHealth.com offers access to more than 1,700 plans from 12 leading carriers including Aetna, Cigna, Humana, UnitedHealthcare and participating Blue Cross and Blue Shield companies.**
• Customers can compare and enroll in health plans online at DirectHealth.com or over the phone at 888-383-2111.
• 2,700 Walmart stores will be staffed by independent, licensed health insurance agents from DirectHealth.com that can help customers enroll in certain health insurance plans. Agents can also help provide education and guidance on other insurance options.  
• Enrollment can take place during the Medicare open enrollment period from Oct. 15, 2014 through Dec. 7, 2014.

For customers under 65:

• DirectHealth.com offers access to thousands of Health Exchange plans from more than 300 leading carriers.
• Customers can compare and enroll in health plans online at DirectHealth.com or over the phone at 888-327-0388. 
• 2,700 Walmart stores will be staffed by independent, licensed agents from DirectHealth.com who can help provide education and guidance about health insurance options.  
• The Health Insurance Marketplace open enrollment period takes place from Nov. 15, 2014 to Feb. 15, 2015.

Customers can compare or enroll over the phone by calling 888-383-2111.