Physicians should learn from drugstores' clinics

Charlotte Business Journal - August 10, 2007

by Anthony Cirillo

Guest columnist

A major drugstore retailer recently sent me a box of tissues announcing the opening of a clinic in a local store.

On my next visit to my physician, I brought him the tissues. He may need them.

CVS/Caremark Corp., Wal-Mart Stores Inc. and Target Corp. are some of the common names now competing with physicians. Health clinics in retail establishments are converging in a perfect storm for health care.

The number of uninsured is growing. Small and midsized employers are increasingly not providing health benefits, or offering plans with greater limitations. Consumers are opting into high-deductible health plans with greater out-of-pocket costs.

Strictly from a cost perspective, care in a retail setting can be less than half what a doctor visit costs -- averaging $40 to $70 per visit versus a trip to a doctor's office that could be upwards of $150. When that's coming out of your pocket, it adds up.

That said, the Convenient Care Association says 40% of its member clinics do have some managed-care contracts in place. The association, based in Philadelphia, was founded last summer to establish common standards for this burgeoning industry.

Next is access and convenience. Walk into one of those retail clinics -- no appointment necessary -- and you will be seen promptly. The hours are extended to meet the consumers' schedule.

And we evidently need to see a physician more.

According to a recently published study in the British Medical Journal, the average American spends a total of about 30 minutes a year with a primary-care physician. This is inadequate for meeting the preventive, acute and chronic needs of the population, notes the lead author, a physician at the University of California at San Francisco. He says this time with a physician does not even meet the recommendation for preventive care of the Centers for Disease Control and Prevention.

It is any wonder retail clinics are going to take off? The knee-jerk reaction by the American Medical Association and others is to allege shortcomings in quality of care and conflicts of interest at the clinics. The right course would be to realize the marketplace will win. People do want those clinics.

According to the National Center for Health Statistics, there are 910 million visits to physicians in the country each year, with about half to primary-care physicians.

Extrapolating from Mecklenburg County's population, there could be as many as 1.2 million primary-care visits in the county each year worth $184 million at $150 per visit.

Even if those in-store clinics siphoned off 1% of the business, that is nearly a $2 million hit to local physicians.

So what does a physician do? Instead of trying to regulate such clinics out of existence, physicians should learn from their nimble competitors and the appeal of their cost and convenience.

Here are some suggestions for physicians:

•Extended hours. Retail clinics see patients on the patient's schedule. Physicians' offices should as well. Offices should routinely be opened for 12 hours so a physician, nurse practitioner and physician's assistant are always available. Physicians can overlap schedules like pharmacists do to provide full coverage.

•House calls. If you want to compete, those can no longer be viewed as a novelty but a necessity. I have a physician friend in Italy. While I tease him about his limited office hours, truth is he is on the road in the Italian countryside tending to his patients.

•Concierge services. The Charlotte region is becoming home to all sort of industries geared to consumer convenience, driven by consumer wealth and laziness.

So jump on board. Have a dedicated patient cell phone, and give out your number. Consult via the Internet. Institute a pick-up and drop-off service for elderly clients. Actually return phone calls. Provide your e-mail address. See people at their appointment time or compensate them in some way, and likewise institute rules for late patients. Add other services after asking your patients what they want and consulting with your front-line staff.

Some may label those as concierge services and want to charge extra for them. Perhaps they're simply the right things to do.

•Team up. Hospitals and physicians need to start thinking about their own ventures in shopping malls, price clubs and grocery stores. Those retail clinics are referral neutral so you not only lose incremental revenue but you may be losing patients as well. Control the situation.

The more clinics that open, the more need for medical supervision. Be the entrepreneurial physician who seizes this opportunity.

General practitioners, of course, are paying attention to that, but there's an opportunity here for pediatricians as well. Hurried, frazzled moms are the marketing target of those clinics. If they can bring baby in fast and get the service they need, 20 moms will be there the next day.

Precious few physicians are recognizing the competition and adjusting their practice philosophy accordingly. Granted they are harried, busy, under pressure and under contract to produce by their hospital owners.

Yet, ultimately, the marketplace, not the provider, decides. You offer a great service, people will come. If they like it, they will tell others.

CVS would not be opening 300 more of the clinics around the nation without solid research that suggests their customers want them and like them. The perfect storm is descending. Grab your umbrellas.

Anthony Cirillo is president of Fast Forward Strategic Planning and Marketing Consulting in Huntersville. He may be reached at cirillo@4wardfast.com.