TAMPA, Fla. — A continuing shortage of primary care doctors and overburdened emergency rooms are pushing a rising number of consumers to retail health clinics and urgent care centers, according to a study by Marketdata Enterprises Inc.
The research firm said Monday that the number of retail clinics, now at about 1,400, will top 1,500 by the end of this year, exceed 1,700 by the close of 2013 and jump to 2,700 sites by 2016.
The study, titled "The Market For Retail Health Clinics & Urgent Care Centers," found that the number of yearly patient visits to retail clinics has skyrocketed, climbing from 1.48 million in 2007 to 5.97 million in 2009, and is expected to reach about 10.5 million by the end of 2012.
Marketdata estimated the total retail clinic market at $10.8 billion, with urgent care centers accounting for $9.23 billion and retail centers for $786 million.
Marketdata projected that revenue for the 9,000 urgent care clinics will rise from $9.23 billion this year to $14.16 billion by 2016, while sales for retail health clinics will grow from $786 million to over $1.38 billion during that time frame.
According to the study, the average revenue per clinic is $512,000. Meanwhile, the investment needed to open a retail clinic in a drug store chain, supermarket or big-box retailer is about $250,000 and to open a stand-alone urgent care center with on-site X-ray machines and other equipment is $750,000 to $1 million.
New retail clinics, less than two years old, may have 10 to 15 patients per day, at an average fee of $60 to $75, while "established" clinics will see 25 to 30 patients per day, with visits spiking during the fall flu season, the research revealed.
Retail clinics could go from break-even to profitability by adding weight-loss programs to their menu of services, Marketdata said, calling such a service "a natural fit" because dieters want "drop-in anytime convenience, low price, and personal attention."
"The primary care M.D. shortage is getting worse, and consumers with less insurance are increasingly using retail health clinics for kids’ physicals, flu shots, ear infections, sore throats and minor ailments. Soon, they’ll be using these clinics for diabetes monitoring, weight-loss programs and more," according to John LaRosa, research director at Marketdata.
In fact, the study found that more consumers are using retail clinics and urgent care centers as their first point of entry to the health care system. What’s more, another 32 million consumers will enter the health care market in 2014 when the Affordable Care Act will enable them to get health insurance coverage, Marketdata noted, adding that primary care physicians and emergency rooms won’t be able to handle the increased volume.
CVS Caremark is the leader with 570 retail clinics under the MinuteClinic banner, followed by Walgreens 360 Take Care Clinic sites. Marketdata said Walmart is still testing the retail health clinic waters and talking with potential partners but could add hundreds of sites in its stores in several years.
Half of urgent care centers are owned by physician groups and another 28% by hospitals, which are setting up their own centers separate from emergency rooms.
Marketdata added that private equity firms are keen to invest in this niche health care sector, and several companies such as Doctor’s Express are already franchising.
"Retail health clinics will provide a boon for nurse practitioners and physician’s assistants, who are well-qualified to treat minor ailments. Plus, it’s a great way to learn the business aspects of medicine," LaRosa stated. "Health care is becoming more decentralized, being delivered where consumers shop and work — not just in the doctor’s office and not just 9-5 Monday to Friday — and at less cost."
