Walmart sells MeMD to Fabric, exits telehealth market
ARKANSAS, UNITED STATES — Retail giant Walmart is selling its MeMD telehealth business to healthcare technology startup Fabric. This move coincides with Walmart’s decision to shut down its primary care clinics, marking a significant change in its healthcare strategy.
The acquisition will enhance Fabric’s presence in the employer market, extending its reach to 30,000 employers and 5 million employees.
Fabric’s rapid growth and technological edge
Fabric, formerly known as Florence, emerged from stealth mode in early 2023 and has quickly developed technology that automates clinical and administrative tasks in healthcare.
The company’s telemedicine platform serves health systems, employers, and payers, offering products that use conversational AI to streamline workflows for in-person and virtual patient visits.
“The combination of our teams, technology, and clinicians strategically positions Fabric to expand quickly across payers, employers, and provider organizations,” said Aniq Rahman, Fabric’s founder and CEO.
Expanding services and market reach
MeMD, founded in 2010 and acquired by Walmart in 2021, provides on-demand medical and behavioral health services to millions of members nationwide. Under Walmart’s ownership, MeMD saw significant growth and expansion.
With the acquisition by Fabric, MeMD is expected to expand its provider network and add virtual behavioral health services to its offerings.
“We’re doubling down on virtual care, which benefits all of our customers, including payers, employers, health systems, and provider groups,” Rahman noted. “It’s just adding more technology, more product pieces to our team.”
Strategic synergies and future plans
Fabric’s acquisition of MeMD builds on a previous technology partnership aimed at streamlining patient intake and documentation. The integration of MeMD’s services will enhance Fabric’s care enablement system, which uses AI-powered clinical intelligence to triage and route patients efficiently.
“We are able to provide members the ability to route back to the health system in a thoughtful way. This benefits both sides of our customer base, both the demand side and supply side,” ,” Rahman explained.
Financial and market impact
While financial details of the acquisition were not disclosed, the deal marks Fabric’s third acquisition in the past 18 months. Earlier acquisitions include Zipnosis and Gyant, which have helped Fabric expand its asynchronous virtual care capabilities and digital front door for patients.
Fabric has reported triple-digit annual sales growth and continues to attract significant investment, including a $60 million series A round in February backed by prominent investors like General Catalyst and Thrive Capital.
Telehealth market trends and future outlook
The telehealth market is undergoing significant changes, with major players like Teladoc and Amwell facing profitability challenges. Despite these shifts, Rahman remains optimistic about the future of virtual care.
“This is a modality that is not going anywhere; it’s just evolving,” Rahman said. “We want to create a world-class patient experience that allows you to have that direct consumer interaction, whether it’s coming through a health system, a plan, or through an employer.”
This acquisition signifies a pivotal moment for both Walmart and Fabric, highlighting the evolving landscape of telehealth and the ongoing efforts to enhance patient care through innovative technology.
Fabric also plans to continue its strategic growth through thoughtful integration of acquired technologies and opportunistic digital health mergers and acquisitions.
