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If urgent care centers don’t innovate, how long will they last?

Stephen C. Schimpff, MD
Physician
November 27, 2015
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Part of a series.

Urgent care clinics provide a useful service to the community, but their days may be numbered with survival questionable resulting from intense competition from the chain pharmacies and soon from Walmart.

Urgent care companies began to proliferate 30 years ago but have gained traction in recent years as emergency room wait times rapidly lengthened. Urgent care is less expensive than the ER, is open 24/7 or at least begins early and continues late, and the staff is dedicated to minor and moderate medical problems that need rapid or immediate attention. Urgent care centers do not require an appointment like a doctor’s office, but most encourage a pre-call or an online connection to set a definitive time for the visit; meaning little or no waiting time.

Unlike the clinics in the chain pharmacies, these urgent care centers are usually equipped to handle broken bones, minor surgery and laceration stitching. Most urgent care centers have a physician on-site much of the time. Costs vary by type of treatment, but an average bill might be about $100 to $140 compared to more than $500 to $1,000 for an emergency room visit for the same problem. Typical co-pays for those with insurance might be about $40 versus $200 for the same problem seen in the ER. Prices are often posted so there is cost transparency. Insurance is accepted, yet it is also a venue that appeals to those with a high-deductible insurance policy or no insurance.

Urgent care centers often become de facto primary care physicians for many individuals who do not have insurance or simply cannot easily access a primary care provider. Although they do not provide long-term relationship medicine, many smaller centers with just a few providers on staff can and do offer a more personalized service.

As a general rule, these are not centers that cater to dealing with chronic illnesses like heart failure, diabetes or chronic lung disease. That said, the patient with recurrent asthmatic attacks might well use the urgent care center rather than an ER and so too might the patient with brittle diabetes or an exacerbation of heart failure. Patients get to know one physician, NP or PA at the center, learn their schedule and return regularly for continuing care.

For some of the same reasons, urgent care centers are generally not focused on the geriatric population with its many chronic illnesses. Yet, these are individuals that are often in greatest need of rapid attention, attention that could prevent an ER visit or even a hospitalization. Many nursing home patients get sent to the ER late at night when the nursing home staff encounters a problem such as fever, dehydration, breathing difficulties, etc. An innovation would be a relationship between a nursing home or assisted living facility and an urgent care center, ideally using telemedicine technology. This could result in many fewer hospitalizations and ER visits, better care and less physical and emotional trauma to the elderly resident.

Another innovation is to pair a subscription primary care model (akin to direct primary care) with an urgent care center. Conceptually, a person, an insurer or an employer purchases the subscription, which offers the individual an expanded primary care program plus unlimited access to the urgent care center.

For example, one such company partners with urgent care chains and charges $40 to $50 per month, or $480 to $600 per year, for unlimited primary care. Their plan uses the direct primary care concept of decoupling the doctor from the insurer and eliminates the requirements of coding, billing, and preauthorizations. Since the care takes place at an urgent care center, the added capital requirements and the office overhead expenses for the primary care program are minimal. An individual can make an appointment with the primary care provider at the center just as they would with a private practice physician’s office, but he or she can show up on an urgent basis at the urgent care center with no added charge when the PCP/NP/PA is not available.

The concept, at least conceptually, is to not only take advantage of underutilized capacity in the clinics, but also drive down the overall cost of care on a long-term basis. It might improve the cash flow characteristics of the urgent care clinics using this model thus leading to improved care parameters.

Although this model may or may not mean true relationship-based care with a strong bind between an individual doctor and individual patient, it provides episodic care, urgent care, an annual exam, preventive services and other elements of primary care. When the physician or nurse practitioner is not available, the clinic is still open extended hours for urgent issues.  Eliminating the requirements of insurers and combining the primary care practice with underutilized space at the urgent care clinic means that the PCP salary and overheads can be covered with about 10-12 patient visits per day, substantially less than the 25 or more visits per day that is typical in a PCP private office.  It is more like a direct primary care practice. As a result, visits can be as long as needed. Added benefits can be discounted laboratory testing and medications available at wholesale prices.

Dr. Josh Umbehr, the founder at AtlasMD direct primary care practice, offered an interesting opinion piece, titled “A Solution to ER Overcrowding: Direct Care.” He moonlights in a local ER and comments that about 80 percent of what he sees he could have treated in his primary care office at a lower cost. He states that he is required by hospital protocol to do multiple tests that he would not likely do in his own practice, which increase the costs of care to more than $500 per visit. Recognizing that they will often not be paid since the patient may not have insurance, about 50 percent of hospitals now charge a fee of about $150 in cash for those seeking care in the ER but not requiring true emergent help. Although the patient’s insurance might pay for the ER visit, the patient is expected to pay the $150 fee. Further, for that same $150, Dr. Umbehr would not only treat the current issue but give a three-month membership to his practice. If the patient needed a follow-up, they would receive it at no extra cost, whereas an ER visit would be at least an additional $150 out of pocket.

PCPs with a direct primary care practice are available 24/7 by cell phone and can do most of what the urgent care centers can do, excepting some moderate trauma care. Ostensibly they are in competition but an innovative partnership would perhaps create a site for blood drawing, etc. and be advantageous to both parties plus the patient.

Urgent care centers offer a valuable option to the community but they are undergoing extreme and rising competition from the chain pharmacies like CVS and Walgreens and soon Walmart. Each of these siphons off a large percentage of the “easier” patients leaving the urgent care center for broken bones, lacerations, etc. That is not enough to sustain the business so they will need to find new venues for care delivery. Including a primary care physician(s) on site in an innovative payment arrangement or serving as a care site for evening issues at nursing homes or assisted living facilities may prove valuable and extend their viability. Otherwise, they may become dinosaurs and close down.

Crisis-2 jpegStephen C. Schimpff is a quasi-retired internist, professor of medicine and public policy, former CEO, University of Maryland Medical Center, and senior advisor, Sage Growth Partners.  He is the author of Fixing the Primary Care Crisis: Reclaiming the Patient-Doctor Relationship and Returning Healthcare Decisions to You and Your Doctor.

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If urgent care centers don’t innovate, how long will they last?
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