Lastyear Kroger teamed up with Walgreens to let shoppers pickup their online orders at some of the drug chain's stores. (Photo:Shutterstock)

Kroger Co. is talking to potential partners in the health-careindustry about developing a new line of business.

Chief Executive Officer Rodney McMullen said the grocer is“doing a lot of exploratory work” to identify an area of healthcare that it could enter and benefit customers — and perhaps lowertheir medical costs. Such a venture would also represent a freshrevenue stream for Kroger and complement the advertising andpersonal-finance businesses that it's counting on to help generate$400 million in additional operating profit by next year.

“Health care is an area where we see a lot of opportunity,”McMullen said in an interview Thursday. “We're talking to severalpotential partners at the moment,” which he declined to name.

Related: To compete with Amazon, CVS dips a toe into theonline retail business

Kroger's not alone in seeing an opportunity in health care.Walmart Inc. has stepped up its ambitions inthe wellness space in recent years, offering free health screeningsfor shoppers and using its clout to buy health care for some of itsworkers directly from providers. Amazon.com Inc. has aligned withBerkshire Hathaway Inc. and JPMorgan Chase & Co. on a wellnessventure that will be called Haven. It aims to improve access to primarycare and simplify insurance.

Kroger has also been active in this area. Last year it teamed upwith Walgreens to let shoppers pick up their online orders at someof the drug chain's stores, which would also carry a selection ofKroger's Simple Truth natural and organic foods. The test began inone store in Northern Kentucky and is now in 13. The supermarketalso operates a specialty pharmacy business that posted “strong”sales growth last year, McMullen told analysts Thursday. Thecompany derives about 9 percent of its sales from pharmacyoperations, according to filings.

Any incremental revenue from health care would be welcomed byKroger's investors, who punished the shares Thursday after thecompany provided a lackluster full-year profit forecast and saidfourth-quarter margins contracted nearly a full percentagepoint.

Read more:

• Bucking merger trend, Walgreens doubles down onpartnerships
• How broker consolidation and industry alliances arechanging the industry
• Amazon has just entered the drug-distributionbusiness

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