As the costs of medical treatment continue to rise and patients seek more convenient care options, retail clinics are increasingly filling the void. Euromonitor International explores the development of this trend worldwide.
Status of retail clinics
Retail clinics are a relatively recent phenomenon. In the US, where such facilities are the most widespread, the first retail clinics opened in 2000, but according to a November 2011 RAND study, the number of clinics increased by a factor of 12 between 2006 and 2010. The UK National Health Service (NHS) operates several walk-in health centres, but the first centre in a retail location only opened in 2008. While the NHS made an earlier attempt to provide patients with more convenient care access, opening six commuter walk-in centres near railway stations between 2005 and 2007, it closed the last of these centres in November 2011. Canada, Kenya, and other countries have also only started experimenting with retail models of care within the past five to ten years.
The main drivers of this trend vary by region, but cost and convenience are two key elements. Cost is particularly compelling in the US, which leads the world by far in health expenditures, topping 23% of GDP in 2010 according to Euromonitor International data. Retail clinics are being billed as a more cost-effective option particularly in comparison to emergency room (ER) trips. Many insurance companies offer lower co-pays for clinic visits, and a September 2010 RAND study estimated that retail clinics and urgent care centres could handle 14%-27% of ER cases, potentially saving over US$4 billion a year.
From a consumer standpoint, though, accessibility may be even more important than expense. A study in the November 2011 American Journal of Managed Care found that proximity to a retail clinic was the strongest predictor of use, with no association between primary care availability and clinic use. A March/April 2010 Annals of Family Medicine study reported that appointment wait time is the most critical factor in care-seeking decisions. Retail clinics have certainly capitalized on this consideration. The Boots pharmacy chain in the UK offers services during extended hours, as do many other chains, and nearly all clinics either partially or exclusively follow a walk-in appointment model. International health care provider Global Health Partner invested in October 2011 in a Finnish company operating shopping centre and pharmacy clinics in Finland, with the ultimate goal of expanding to other European countries; providing care seven days a week without an appointment is an integral component of the marketing strategy.
Retail clinics in the developing world also attempt to respond to financial and care availability concerns, albeit in different ways. Healthpoint Services is a for-profit company in India built on the premise of providing clean water and health care services in rural or remote areas. Its “tele-medical centres” offer consultations with doctors and other health care workers via video conferencing, on-site diagnostic tests, and access to a licensed pharmacist. Both prescription and over-the-counter (OTC) drugs are sold at large discounts, up to 50%. There are currently centres in several districts in India, but Healthpoint has plans to open pilot clinics in the Philippines and Mexico in 2012.
The HealthStore Foundation follows a similar concept in Kenya. Though it is a non-profit organisation, it supports the development of retail clinic franchises owned and operated by nurses. These Children and Family Wellness Shops are located at market centres in agricultural areas with populations of around 5,000 people. As of 2010 there were 48 clinics in Kenya, with partnerships in the works for Rwanda as well. Such retail clinic franchises also operate in Ghana, Uganda, Myanmar, Pakistan, and other countries.
Growth, innovation … and limitations
As retail clinics become more common, many chains are expanding their service offerings and exploring new routes of care delivery. While many small businesses cannot afford “corporate wellness” programs, they do have the opportunity to partner with retail clinics. In addition to its US in-store locations, Walgreens has several worksite-based clinics. Many clinics bolster their menu of vaccinations, respiratory examinations, and other treatments with wellness programs for things like losing weight and quitting smoking. Tesco supermarkets in the UK opened a clinic in November 2011 that offers midwife-run pregnancy clinics and health checks. A Loblaws supermarket clinic in Toronto, Canada provides physical therapy and consults with an in-store dietitian, as well as a 50-foot wall of vitamins and dietary supplements.
Some clinics are even choosing to specialize rather than increase their treatment scope. The Bartell Drugs pharmacy chain operates in-store travel clinics with immunizations, consults, and access to OTC drugs for digestive issues common to international travellers. Traditional medicine purveyors are following the retail clinic trend, too. In October 2011, Traditional Chinese Medicine brand Beijing TongRenTang opened a clinic and retail outlet in Dubai, UAE with plans to expand to other countries in the Middle East. Maharishi Ayurveda Products Pvt Ltd runs franchise Ayurveda health clinics throughout India.
Beyond having easy-to-access locations and flexible hours and appointment policies, companies are finding other ways to increase the appeal of visiting a retail clinic. Wal-Mart Canada Corp and Loblaw Cos Ltd. give walk-in patients pagers, so they can shop in the rest of the store while waiting to see a clinician. Some pharmacy chains, including Rite Aid and Safeway, offer promotions like coupon books and even grocery discounts for patients who get flu shots at their retail clinic locations.
There are a couple caveats to the recent boom in retail clinic popularity. One, they do not serve the entire patient population. Most retail clinics do not treat infants and babies, with age restrictions ranging from 18 months and over to 24 months and over. Even more critically, their financial sustainability or profitability is still a bit of a question mark. Wal-Mart recently announced its intention to find partners with whom to open new in-store clinics, but it has closed several previously-operating locations in the past five years. CVS’s MinuteClinics are only expected to break even for the first time in 2011 in the US.
These considerations notwithstanding, the retail clinic trend is one that can be expected to continue. For countries in the developing world, retail clinics are proving to be one of the most effective mechanisms for delivering care to patients who would have difficulty accessing it otherwise. For the US in particular, there are few other viable alternatives for moderating extremely burdensome medical costs. In general, patients are increasingly expecting treatment where and when it is convenient for them. At the close of 2011, retail clinics are filling that niche.