Retail clinic with desk and waiting areas

Recent headlines about retail clinics have been ominous: “Retail Clinic Usage Costs $14 More Per Person Per Year”, “Retail clinics convenient but they hike costs, study shows”, “Retail Clinics Increase Primary Care Spending,” and so on.

The articles refer to a study released March 7, 2016, by the RAND Corp. in the journal Health Affairs that shows patient utilization of retail clinics from 2010 to 2012 increased medical spending by $14 per person per year. The study tracked 3 million Aetna patients and found that, most of the time, retail clinic utilization represented “new utilization” rather than substitute care for a more expensive doctor’s visit. Simply put, patients who otherwise would have stayed home and battled a cold or cough on their own instead visited a retail clinic up the street.

Critics of the study point to the usage of old data, suggesting data recorded now—in 2016—might produce different results. Today there are more than 130 retail affiliations with health systems in 87 of the nation’s key markets, including New York, Chicago, and Atlanta. These affiliations encourage chronic disease management, patient education, and medication adherence—all strategies used to improve health and lower costs in the long-run.

With the surge of retail affiliations, retail clinics are positioned less as docs-in-the-box and more as gateways to the medical community, access points that can encourage individuals to be active participants in their health.  If “new utilization” is still as high today as it was in 2012, this could translate to more patient referrals to primary care physicians, which could help care continuity, health management, and cost savings. The idea here is that those patients who chose to visit the retail clinic instead of sitting on their couch become the captive audience, sudden players in the healthcare arena.

Critics also point out the study only looked at patients with commercial insurance. If it is true that retail clinics encourage higher utilization and therefore higher spending of patients with commercial insurance even today, retail clinics could at least keep those uninsured or underinsured individuals from accumulating thousands of dollars in emergency-room visits for low-acuity care. This trade-off is understudied.

The key takeaway from the study is that convenience will increase utilization. For pharma, this could be great news if more patients seek over-the-counter medicine than Walgreens’ brand ibuprofen. For insurers and patients, the impact is indeed less known. Could Patient A’s cough had turned into bronchitis if he or she hadn’t visited the retail clinic and received prescription medication? Could Patient B’s diabetes have been diagnosed if he or she hadn’t visited the retail clinic with complaints of a bladder infection?

The RAND study shows patients spent money (copays and insurance money) they otherwise wouldn’t have spent on low-acuity conditions during the three-year period; it does not take into account whether any of these patients were then referred to primary care doctors to receive preventive care or more complex diagnoses, as minor ailments can be indicative of more complex illness. The goal of all preventive care is to reduce the likelihood of serious complications and emergency-room visits later—but whether those theoretical cost savings justify higher actual annual costs is not an allowance many retail clinic critics are willing to make.

All in all, the RAND study should not be dismissed but rather placed in the grand scheme of cost-benefit analysis. While helping prevent costly health complications and encouraging active medical participation is the retail clinic ideal, retail clinics are a business, and at the end of the year, $14 more per person for 3 million patients equals $42 million a year. Retail clinics are a good business model, in other words, and are not going anywhere anytime soon. Should Patient A sleep away his headache or go to the retail clinic down the street? Ask him—he’s the consumer.

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