What Teladoc Health’s partnership with Walmart says about DTC telehealth

Teladoc Health recently inked a deal with Walmart, and the terms of the partnership say a lot about the state of direct-to-consumer (DTC) telehealth. 

Under the deal, Teladoc’s urgent care, dermatology, and nutrition services are now available on Better Care Services, the digital health platform Walmart launched earlier this year. (Teladoc’s BetterHelp mental health service has been available on the platform since January.) Walmart’s customers can pay $89 to access Teladoc services in an “integrated healthcare experience,” as the telehealth vendor put it.  

Convenient care – or a business move?

Teladoc positions the partnership as serving “Americans who are uninsured, underinsured, or simply want a more affordable and convenient way to get care.” Not surprisingly, reality is a bit more complicated.  

Healthcare Dive noted Teladoc is no stranger to retail partnerships. In the last year, the company joined Amazon’s health benefits connector and allowed Instacart members to browse its recipes and meal plans. More partnerships are likely on the horizon as Teladoc transitions from subscription- to visit-based revenue models. 

Multiple factors seem to be motivating this shift. One is the general stagnancy of telehealth adoption. FAIR Health’s data indicated that telehealth visits represented 5% of all commercial claims at the end of 2025. As that figure has remained virtually unchanged since October 2020, it’s clear the market isn’t growing.  

A counter to pharma’s DTC telehealth push?

Another motivation may be countering the influence of pharmaceutical companies stepping up their DTC offerings. These often rely on telehealth and digital platforms to connect patients to services that don’t require insurance approval and, as a result, don’t show up in claims.  

An IQVIA commentary suggested patients like pharma’s DTC programs for their autonomy, convenience, lack of friction, and connections to wraparound support, particularly for weight-loss programs linked to use of glucagon-like peptide 1 therapies. Teladoc is admittedly familiar with this model, having integrated with Eli Lilly’s LillyDirect to offer self-pay GLP-1 options to eligible members.  

That partnership, though, came prior to a Congressional report raised valid questions about whether a pharma-backed DTC telehealth platform “seemingly defaults to a medication-first paradigm” and “risks glossing over the comprehensive evaluation necessary for high-quality patient care.” It’s hard to blame Teladoc – or anyone, for that matter – for opting to put its eggs in more than one basket. 

Will visits or subscriptions win the day?

Teladoc’s increased alignment with retailers and pivot to visit-based revenue isn’t without risk. Walmart’s own foray into health ended abruptly in 2024 due to what the company called an “unsustainable” business environment.  

Plus, Modern Healthcare has detailed how high acquisition costs for DTC telehealth customers can cut into margins. Given that telehealth charges are less than 20% of what in-person care costs, the margin for error is razor thin – and arguably even smaller when paired with a partner in retail, another industry plagued by tight margins.  

Meanwhile, Teladoc isn’t the only telehealth vendor making headlines. Amwell co-founder Dr. Roy Schoenberg will soon lead Amazon Health Services. He leaves behind a company that has struggled with low margins on individual visits, according to Forbes. 

It remains to be seen how Teladoc’s focus on visits will compare to Amwell’s traditional service- and subscription-based model. In either case, both approaches come with the caveat of trying to find customers in a market that hasn’t shown signs of growth but nonetheless has pharma companies and retailers looking for a bigger piece of the pie. 

Brian Eastwood is a Boston-based writer with more than 10 years of experience covering healthcare IT and healthcare delivery. He also writes about enterprise IT, consumer technology, and corporate leadership.