Hospitals are increasingly adding retail clinics to their array of services because they can help to reduce some costs. A recent national study by the Center for Studying Health System Change (HSC) found that the proportion of retail clinics owned by hospital systems doubled (from 9 percent to 18 percent) between 2007 and 2010.
Prominent hospital systems owning and operating clinics include the Minnesota-based Mayo Clinic, Pennsylvania-based Geisinger Health System and California-based Sutter Health.
Hospitals have been looking at various strategies to meet the high volumes of urgent care needs that have been increasingly on the rise, said Caroline Steinberg, vice president at the American Hospital Association. Retail clinics fit the bill because lower-acuity patients or those with episodic needs like the flu can get care in these facilities at a cost much lower than in the emergency department.
A secondary benefit, she said, is that these clinics are good feeders to hospitals. "Retail clinics can offer referrals and it becomes another entry point for the hospital," she said.
The rise in hospital retail clinic ownership comes as traditional investor ownership has dropped (from 24 percent to 16 percent between 2007 and 2010), according to the HSC study. The study attributes the drop in investor-owned clinics to the difficulty these investors had in getting access to sufficient capital during the 2008 recession.
But the attractiveness of retail clinic ownership remains, especially as more consumers use them.
The HSC study found that from 2007 to 2010, the proportion of U.S. families using a retail clinic in the previous year nearly tripled from an estimated 1.7 million families using them in 2007 to 4.1 million in 2010.
"I think the study clearly showed that retail clinics are in a growth mode and are continuously being used more and more," said Ha Tu, HSC senior researcher and coauthor of the study. "It's an open question whether retail clinics will grow beyond their current limited role in the healthcare delivery system and finally emerge as the widespread 'disruptive innovation' that some have long predicted."
However, if more hospitals decide to transition to accountable care organizations (ACOs), it may be more likely that retail clinics will "become central to the provision of primary care in the U.S."
"Provider systems in this case might be motivated to work with retail clinics as a lower-cost setting option for primary care," Tu said.
This story was originally published in Healthcare Finance News.