By Leigh Page
Retail Clinics Are Everywhere
Retail clinics have been siphoning off patients from doctors’ offices for years. Located in chain pharmacies, big-box retailers, and grocery stores, they treat low-acuity conditions, such as sore throats and children’s ear infections. They see patients on a walk-in basis, making it possible for busy people to visit them while on errands, and at a relatively low cost. –
Should physicians compete head-to-head with these operations, or should they differentiate themselves, focusing on higher-acuity care? And should they ask patients not to use these clinics, or cooperate with them and get referrals in return?
Can You Compete on Convenience?
Retail clinics are at the cutting edge of a “convenience revolution,” according to Ateev Mehrotra, MD, a leading researcher of retail clinics and associate professor of healthcare policy and medicine at Harvard Medical School. “People today expect care right away,” Dr Mehrotra said. “It’s now part of our society.” In patient interviews, “people told us, ‘I called my doctor’s office and they say it’s a 3-4 day wait, and I just want to get care,'” he said.
The clinics are stripped-down, lower-cost versions of urgent care centers. Rather than using doctors, they usually employ nurse practitioners (NPs), who adhere very closely to evidence-based guidelines. In recent years, retail clinics have branched out from treating simple acute conditions to providing preventive care, such as flu vaccines.
According to a study in Health Affairs that Dr Mehrotra coauthored, almost one half of patients who use the clinics do so when doctors’ offices are normally closed. Retail clinics take walk-in patients and are open 7 days a week. A few of the clinics run by CVS Health, the industry leader, were even open on Christmas Day, according to the CVS website.
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Doctors initially resisted the convenience revolution. Robert A. Lee, MD, a family physician in Johnston, Iowa, said when he first started practicing, the goal was to have your appointment book filled 2 weeks out. “It meant you were very busy,” he said, but he realized his patients weren’t happy. “The patient says, ‘I’m sick today,’ and the doctor says, ‘Great, I’ll see you in 2 weeks.”
Dr Lee, who is a member of the board of American Academy of Family Physicians (AAFP), has introduced same-day scheduling to compete with retail clinics. Many of his peers have done the same. The AAFP reported that asof 2012, 73% of AAFP members allowed for same-day scheduling, 43% had extended early morning or evening hours, and 32% had weekend hours.
In Overland Park, Kansas, AAFP board member Michael L. Munger, MD, is also providing same-day appointments, and he says the changes make his practice a formidable competitor of retail clinics in the area. When patients visit one of the clinics, clinic personnel usually ask them if they want a report of the visit to be sent to their doctor. Since Dr Munger’s practice implemented same-day appointments 2 years ago, the number of reports from the clinics have fallen by almost 70%—indicating that fewer patients are using them, he said.
Can You Compete on Price?
Even though practices can improve access for patients, it’s extremely difficult—maybe impossible—to match retail clinics’ low prices. NPs in the clinics cost far less than doctors, and such operators as CVS and Walgreens further reduce costs by not having to pay for store space. A 2009 study led by Dr Mehrotra found that the overall cost to the patient to get care at a retail clinic was 30%-40% lower than at physician offices and urgent care centers.
Salud Pediatrics in Algonquin, Illinois, is open weekday evenings and Saturday morning, but it hasn’t lowered prices, said Brandon Betancourt, the practice’s administrator. Even though he passes a few retail clinics on his way to work, “going head-to-head with retail clinics [on price] is not the way to go,” he said. “Retail clinics can afford to let their healthcare operation be a loss leader. The clinics get people into the store to fill their prescriptions and buy things.”
Instead of low prices, Salud emphasizes quality. “Medicine is not just about speed and convenience,” Betancourt said. “If the patient wants that sort of medicine, you should be very clear about that and tell them, ‘This is not the place for you.'”
When billing a visit for a covered patient, physicians charge what the insurer will pay on the basis of the Current Procedural Terminology (CPT) code. Robert Wergin, MD, a family physician in Milford, Nebraska, and president of the AAFP, said when he makes quick visits with patients who have similar complaints as retail clinic patients, he often uses CPT code 99212, which pays about $60; that is similar to the clinics’ rate.
Retail clinics’ low prices, however, seem to be getting more attractive to patients. Traditionally, the clinics tended to attract people who are more interested in convenience than price. But as high deductibles become the norm and people have to pay for more of their care out of their own pockets, price seems to matter more.
It used to be that practices could compete with retail clinics on price. As recently as 6 years ago, most adults visiting retail clinics were not covered by their health insurance. Thus, when these patients went to a doctor, it was actually a better deal than a retail clinic. At the doctor’s office, patients would only have to cover the copay, provided that they had met their deductible. But at the clinic, they’d have to pay the full charge. That has changed, however, as retail clinics successfully negotiated coverage with insurers. CVS recently reported that more than 80% of people who visit its clinics are now covered by insurance.
The doctors’ cost advantage not only has slipped away, but also has turned into a disadvantage, owing to changes in copay policies. Some payers have reduced or completely waived the copay for retail clinics, but not for doctors. In 2008, Blue Cross and Blue Shield of Minnesota waived the copay just for retail clinics, and CVS has reduced or eliminated the copay in many of its own contracts with payers. CVS calculated that for people with reduced copays, utilization of its clinics rose by 247%.
How Easy Is It for Physicians to Compete?
There are two basic ways to compete with retail clinics: provide same-day appointments, and extend office hours into early evenings and Saturday morning. Of course, extending hours requires an extra time commitment from physicians and staff. And although same-day appointments aren’t difficult in the long run, the transition can be challenging, according to doctors who have made the change.
RESEARCH: Retail clinic users also had 12 percent fewer emergency department visits than their counterparts.
The goal behind same-day appointments is, “Do today’s work today,” Dr Lee said. Before the shift, “we still did the same amount of work as we do now, only 2 weeks later.” To move the schedule forward 2 weeks, physicians and staff had to work extra hours, he said.
Dr Lee said his practice keeps 10%-30% of slots open in its appointment book up to the day of the appointment. Patients can either call up or walk in, but the practice prefers that they call first. “The schedule is often completely filled by the end of the day,” he said. “If they come in for a rash, we take care of whatever else needs to be done,” such as a tetanus shot. If the open slots are not all getting filled, the practice may call patients with chronic diseases and ask them to come in for necessary check-ups.
There are other ways to offer same-day appointments. Dr Wergin, the AAFP president, provides same-day slots to patients with a limited set of conditions that basically match what the retail clinics treat, such as sore throat, ear infections, sinus infections, bladder infections, and pinkeye.
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When these patients go into an examination room, an orange flag is put on the door, and either Dr Wergin or his physician assistant ducks into the room between visits with other patients. He said it’s possible to squeeze in these patients without upsetting the schedule because the visit is very short. “The patient may bring up other matters, but unless it’s an emergency, we ask them to make a regular appointment,” Dr Wergin said.
Dr Wergin also sees patients on Saturday. On Saturday morning at another location, he only sees patients who show up and does not take appointments. The extra time commitment is worth the trouble, he said. “It’s a joy, especially for parents with children,” he said. “They’ll grab my arm and say, ‘I want to thank you so much. I know you didn’t have an appointment, and I appreciate it so much that you could fit me in.” He thinks the extra hours enhance patient loyalty. “When they experience this, they’re my patient for life,” he said. “They would walk through a wall for me.”
How Many Clinics Are Too Many?
Despite talk of retail clinics being the wave of the future, their numbers are still underwhelming—just over 1400 from coast to coast, at last count. In a 2013 report, the Center for Studying Health System Change concluded, “To date, retail clinics have yet to become the ‘disruptive innovation’ in health care that some observers predicted.”
Moreover, retail clinics tend to be concentrated in higher-income suburbs, hardly penetrating many small towns or inner cities. According to the Convenient Care Association, which represents retail clinics, only about one third of Americans live within a 10-minute car ride from a retail clinic, which is considered the maximum distance many people would travel to use one. Still, losing one third of patients is no small disruption to a practice.
Not everyone, however, is skeptical about the growth and impact of retail clinics. A recent report by Accenture predicted that the number of retail clinics would double from 2012 to 2015. The report cited “accelerating forces of change,” including greater demand for healthcare under the Affordable Care Act (ACA), as well as hospital systems’ growing interest in collaborating with the clinics.
Many physicians are bracing for the challenge. Although Dr Lee lives in an area with just a few clinics, “we see them coming nationally,” he said. In Overland Park, Kansas, where CVS and Walgreens clinics are already plentiful, Dr Munger said, “Retail clinics are here to stay.”
Are Patients Enthusiastic About Retail Clinics?
So far, patient use of retail clinics is hardly predominant. A study by Dr Mehrotra found that retail clinics logged almost 6 million visits in 2013, which was only about 1% of physicians’ total office visits for that year. Even within the limited number of low-acuity conditions retail clinics treat, they accounted for less than 7% of patient volume in 2011, according to another study.
The clinics are popular with parents of young children and busy professionals who don’t have the time to wait for a doctor’s appointment. This may seem like a niche audience, but larger demographic forces are on the horizon, and they help explain why so many investors are throwing their money at retail clinics.
A new generation of Americans in their 20s seems to be moving from doctors’ offices to retail clinics. “Younger adults are the dominant users of retail clinics,” Dr Mehrotra said. According to a 2013 survey, one third of people in their 20s don’t have a doctor, and this age group is twice as likely as people older than 50 years to use retail clinics or urgent care centers.
Younger patients are also less satisfied with traditional practices. A 2012 Harris poll found that whereas 52% of patients aged 48-66 years were “very satisfied” with their most recent visit to a healthcare provider, only 35% of patients aged 18-35 years felt that way.
Retail clinics were supposed to be a stopgap measure for when physician’s offices were closed, but now they seem to be creating a steady clientele. A study by Walgreens found that 50% of clinic patients made a return visit, up from 15% in 2007. “After their first visit to a retail clinic, many patients go back,” Dr Mehrotra said.
Just like McDonald’s or Starbucks, the clinics’ brand names that command loyalty and services are predictable, owing to tight adherence to clinical protocols. CVS has its MinuteClinic; Walgreens its TakeCare clinic, now redubbed Healthcare Clinic; and the Kroger grocery chain has its Little Clinic. Dr Mehrotra wrote in one of his studies, “Just as a person walks into a Starbucks in Seattle or Boston and expects similar—if not identical—lattes, a patient can walk into TakeCare Clinics in Seattle and Boston and expect similar if not identical care.”
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- American Academy of Family Physicians. Patient centered medical home. How FPs improve patients’ access to care. AAFP Member Profile. January 2013http://www.iaafp.org/documents/filelibrary/pdfs/AAFPMemberProfileBrochure2013_051E07EEE3A27.pdf Accessed January 2, 2015.
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