Academic journal article Journal of Healthcare Management

How Satisfied Are Hospital Systems with Their Ownership of Retail Clinics?

Academic journal article Journal of Healthcare Management

How Satisfied Are Hospital Systems with Their Ownership of Retail Clinics?

Article excerpt

EXECUTIVE SUMMARY

Retail clinics--while innovative--can no longer be considered a new model of healthcare delivery, as an increasing number of hospitals and health systems now own them. The purpose of this article is to explore the extent to which hospital systems are satisfied with their ownership of retail clinics.

In terms of operational challenges, respondents to our survey, administered to representatives from 19 health systems, were relatively satisfied with clinic staffing and their relationship with the retailers regarding lease terms, store locations, and shopper demographics. They expressed mostly neutral levels of satisfaction with regulations and laws related to retail clinics and low satisfaction with insurance reimbursement and clinics' seasonal patterns. The two areas that received the lowest respondent satisfaction ratings were patient volume and response to marketing initiatives. When asked to share their perceptions of their organization's satisfaction with various strategic aspects of retail clinic ownership, respondents revealed that the clinics were achieving several important strategic goals, such as improved access, increased referrals, defense against competitors, and increased brand exposure. They indicated overall dissatisfaction with profitability and cost-reduction outcomes. We conclude that serious operational challenges and strategic threats must be overcome if retail clinics are to be a successful service line for hospitals and health systems.

INTRODUCTION

Retail clinics are limited-scope healthcare delivery sites located in a retail setting and staffed by mid-level providers that offer convenient and fast care. Although they are an innovative approach to healthcare provision, retail clinics can no longer be considered a new model of healthcare delivery, as they have been in existence since 2000 and currently number 1,357 clinics nationwide (Merchant Medicine, 2012).

During that time, consumer receptiveness to retail clinics has risen: In 2011, 19 percent of healthcare consumers reported using a retail clinic, an increase from 15 percent in 2010 and 13 percent in 2009. Moreover, 37 percent of consumers say they would use a retail clinic if it cost them less than a physician visit would, and 30 percent say they would use one if it considerably reduced their wait time compared to that experienced in a physician's office (Deloitte, 2011).

The number of hospitals and health systems involved in this model over the past five years has increased from their initially low participation (Bums, Guy, & Helmchen, 2011; Kaissi, 2010a, 2010b). The purpose of this article is to explore the extent to which hospital systems are satisfied with their ownership of retail clinics.

BACKGROUND

The majority of retail clinic visitors seek care for 10 simple, acute conditions and preventive care measures: upper respiratory infection, urinary tract infection, sinusitis, bronchitis, pharyngitis, otitis media, otitis externa, conjunctivitis, immunization, and screening laboratory test/blood pressure check (Mehrotra, Wang, Lave, Adams, & McGlynn, 2008). Among commercially insured patients, those who are healthier and wealthier are more likely to use retail clinics (Ashwood et al., 2011). In fact, convenience seems to be the single most important factor in choosing a retail clinic (Ahmed & Fincham, 2010): The clinics are located in settings that patients visit several times per week for other purposes, no appointments are needed to access care there, and evening and weekend operating hours are offered.

Several concerns have been raised about retail clinics' potential for increasing costs, compromising patient safety and quality of care, encouraging overprescription of antibiotics, and reducing delivery of preventive care. However, evidence from recent research suggests that these concerns have been unfounded. In fact, the majority of the evidence clearly shows that retail clinics provide care at lower cost (Mehrotra et al. …

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