business

Retail clinics look to health reform to boost business

With more patients becoming insured, clinic chains expect to gain patients from crowded primary care physician offices.

By Pamela Lewis Dolan — Posted May 10, 2010

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

Retail clinics, whose growth has failed to live up to their initial hype, are seeing an opportunity to expand, thanks to health system reform.

The nation's largest retail clinic chain, CVS-owned MinuteClinic, said it could double its locations in five years, while Walgreen-owned Take Care Clinics said it expects to grow as well. "Health care reform is a positive development for retail clinics, because there are about 30 million people who are currently uninsured who will have health care coverage," Andrew Sussman, MD, president of MinuteClinic, said in an e-mailed statement to American Medical News. "Add to that the aging of the population and the shortage of primary care practitioners, and the opportunity for services such as those provided by MinuteClinic has the potential for growth."

Gregory Wasson, president and CEO of Walgreen Co., said during a recent earnings call that he expects health reform to have a positive impact on business that could create a demand for additional clinics and additional services offered at the clinics. Take Care spokesman Gabriel Weissman said the company would be "thoughtful in our expansion plans" to attract the newly insured patients. He did not say if the company has a specific number of new clinics in mind.

This is the first major talk of expansion from any retail clinic group in several years.

After MinuteClinic reached its goal of 400 clinics by the end of 2007, it said its next goal was to reach 2,500 stores. It never made it past 600.

In 2009, MinuteClinic shut 89 of its clinics, claiming that the seasonality of the business had taken its toll. It planned to reopen those clinics, but many remained closed through flu season.

Meanwhile, Take Care said in 2007 it was on track to open 400 clinics by the end of 2008. It never broke 350.

Overall, the industry has never exceeded the 1,200 mark ,with the total number of retail clinics in the U.S. hovering around 1,100 for the past year. From month to month, a handful of clinics close and a handful open. As of April 1, there were 1,171 retail clinics in operation.

Tom Charland, president and CEO of Merchant Medicine, a Shoreview, Minn.-based retail clinic consultancy firm, said he was surprised that MinuteClinic made such an aggressive statement about growth. He said he thinks reform will help the retail clinic industry somewhat, but he doesn't think it will be as big of a boon as some in the industry think.

The patient breakdown of clinic patients is 80% insured and 20% uninsured, he said, which roughly matches national rates for insurance coverage.

"So are the people they are currently seeing who are uninsured going to become insured? Probably. And are they still going to be coming to the retail clinics? Probably. But do we count those as new patients? No. They are already coming to you," he said. "We shouldn't get too far ahead of ourselves."

However, the clinic industry as a whole still expects business to increase.

"We do expect a positive impact on the industry as different elements of the health reform legislation go into effect," said Tine Hansen-Turton, executive director of the Convenient Care Assn., a trade group for retail clinic operators. "As many millions more Americans will be insured ... we will need to, as a society, support the expansion of access points."

Back to top


ADVERTISEMENT

ADVERTISE HERE


Featured
Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story


Read story

Goodbye

American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story


Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story


Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story


Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story


Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story


Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story


Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story