NCPA - National Center for Policy Analysis

A NEW WAY TO SLOW RISING HEALTH COSTS?

August 25, 2006

Walk-in retail health clinics -- which provide convenient but limited health services -- are spreading nationwide, as more than a dozen clinic operators plan to open thousands in stores such as CVS, Wal-Mart, Walgreens and Kerr Drug, says Julie Schmit in USA Today.

The main value of walk-in chains is cost.  While the clinics vary by company, most treat 25 to 40 medical conditions and charge $45 to $75 a visit, says Schmit.  They reduce their costs a number of ways, including using more Nurse Practitioners (NPs):

  • NPs make, on average, less than half of what family doctors make, yet have advanced degrees and can write prescriptions. 
  • In addition, they not only diagnose ailments but also input computer data, process payments, dispense tip sheets on how to avoid future illness and send patients thank-you notes, reducing labor needs.

Cost savings have been substantial, compared to regular doctor visits:

  • HealthPartners, a Minnesota-based HMO, analyzed two years of claims data of MinuteClinic, a large walk-in chain, and found total costs about 25 percent less compared with those done at doctors' offices or urgent-care clinics.
  • Twin City Pipe Trades, a Minnesota health insurance company, charges the insured a $15 co-pay for doctor visits but waives co-pays for MinuteClinic visits because they cost at least 30 percent less than regular doctor visits.

But price isn't the only driver within the retail clinic industry, says Schmit:

  • Convenience is a large factor, especially for minor or common ailments, where going to a doctor would be inefficient and costly.
  • Competitive retailers such as Wal-Mart are seeking to give customers another reason to choose their store over others.

Source: Julie Schmit, "Could walk-in retail clinics help slow rising health costs?," USA Today, August 24, 2006.

 

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