Last month, after delivering a keynote address in Orlando and spending a little time visiting Disney attractions, I wrote a piece that pondered what it might be like if Disney did healthcare. Last week I was in Washington, D.C., for the World Health Care Congress. The closing keynote was provided by Lee Scott, President and CEO of Wal-Mart Stores. In his keynote, Mr. Scott shared information about Wal-Mart's plans to open healthcare clinics in their stores. They already have more than 40 clinics operating in Wal-Mart stores. The clinics are primarily staffed by nurse practitioners who provide basic primary care services. Mr. Scott said Wal-Mart wants to partner with providers around the country to open perhaps 600 more clinics in the next couple of years. He sees a potential for more than 2000 clinics to one day be operating in Wal-Mart facilities.
In addition, Wal-Mart, Intel and other major employers have announced their intent to provide a transportable personal health record for employees. In fact, the retail health movement which includes organizations such as MinuteClinic and RedClinic, is very focused on using technology to improve care quality and safety as well as to enhance the "patient experience". Price transparency, a factor that is all but absent in services offered in traditional care facilities, has become a hallmark for the retail movement. Likewise, retail clinics go overboard when it comes to savvy marketing, customer relationship management, and patient convenience. And although organized medicine has taken some pot-shots at the clinics, patients seem to love them.
Where is all this going? I think the trend is generally healthy. People want affordable, convenient, high quality care. They are demanding more value for their healthcare dollar. They are looking for a healthcare industry that behaves more like other industries; one that is responsive to market forces and customer demands offering cycles of continuous quality improvement, improved productivity, and lower costs. As my colleague John Goodman of the National Center for Policy Analysis points out, healthcare would behave like other industries were it not for the perverse effects of traditional insurance programs on the supply side of the business. He writes;
Suppose we passed a law tomorrow prohibiting all insurance companies (including Medicare and Medicaid) from paying any medical bills less than $5,000. What would happen? The medical marketplace would transform almost overnight. Within a couple of months, there would be no such thing as a primary care physician (PCP) who did not post prices - at least for routine procedures. PCPs would offer telephone and email consultations. They would keep patient records electronically (just like lawyers and accountants). Overall, there would develop a teeming, bustling, entrepreneurial marketplace for primary care, diagnostic tests and most prescription drugs. Specialty markets would develop for the chronically ill, as doctors competed for their business instead of trying to avoid them. Patient education would become an emerging field, with providers offering to teach diabetics, asthmatics, etc. how to manage their own care. Internet drug sales would double, triple and quadruple, as brand drugs faced increasing competition from generic, therapeutic and over-the-counter substitutes. At the same time, overall health care spending would plummet.
What if Wal-Mart did healthcare? Yeah. What if?
Bill Crounse, MD Worldwide Health Director Microsoft Corporation
Sweet I can't wait to go to wal mart and get checked out by an underpaid over worked nurse who is probably an illegal alien.
While I appreciate your concerns, I think you'll find that the retail movement is every bit as emphatic if not more so as your local hospital or doctor's office about quality and the patient exierience . Afterall, these facilities have a brand to protect besides being subject to the same malpractice issues faced by any other provider.
Aided by the latest information technology and other tools of the trade, doctors and nurses working is these facilities may actually be happier with the defined hours, reduction in business hassels, and other amenities they may find while working in a retail facility.
Bill Crounse, MD
As Chief Architect of Healthwise in Boise, I have watched the emergence of this McDocInTheBox strategy from WalMart with great interest. Frankly, the current payer model is unsustainable, witness the experimentation with HSA and FSA models.
I have not looked to the marketplace to push down primay care costs, until now. I think you may be right, Bill. WalMart may genuinely change the playing field.
Heck, I'll take my kid in there for an ear infection. Why not?
You highlight "transparency" as one of the most significant innovations that retail clinics have brought. I completely agree.
Retail clinics offer transparency both in prices and in the menu of services they provide. Potential customers can easily evaluate ex ante the service they would receive. Compare this with the prevalent provision models (hospitals, physician offices), where none of these parameters is known.
Retail clinics use "exotic", unusual locations. But there is nothing exotic about their business model, based on focus on a limited scope of services, use of IT-supported protocols, and a positioning based on accesibility and convenience. Traditional providers would do well to keep an eye on this development.
Thanks for writing, Jose. You clearly "get it". But I also want to point out that the debate shouldn't be retail vs. traditional providers, but rather what traditional providers can learn from retail and visa versa, to better meet the needs of patients.
Bill Crounse, MD
Last April I posted a piece on this Blog entitled " If Disney Did Healthcare ". I commented that there
The retail/in-store clinic movement is more than a highly beneficial strain of “disruption” to the primary healthcare delivery system. Looking forward, it should also be a significant catalyst and test-bed to improve community health status.
This strategy entails e-collaboration with a robust referral care network harmonizing enabling tools related to consumer-directed wellness, early disease detection and disease management services. Add a hefty dash of one-on-one customer rewarding based on health risk appraisal completion. Follow up with sequential adherence-based economic incentives fulfilled through behavioral target marketing with customized couponing triggered by the HRA findings, seasonal drivers, and respondent demographics. Similar reward triggering could be based on benchmark attainment within disease management protocols.
Win-wins arise building loyal families in touch with new teams of wellness providers. It’s opt-in and HIPAA immune, and is freed from the babble generated by a zillion committees, taskforces, and “working” groups intent on cyber transacting everything. To the extent progressive local and regional health systems are included, the smoother the political sailing. For example, a Blue Cross plan could co-venture production of selected services. Local VNA and health departments would continue to make excellent staffing partners for short-lived campaigns such as back-to-school vaccinations. With insurance coverage arising and rising, the customer is the beneficiary regardless of the chosen production function.
Service demand can be continuously driven by demographic (gender and age) thresholds per U.S Public Health Service guidelines. Such info is captured within the HRA completion process to trigger sentinel announcements (for example, 50th birthday) and invites along with customized coupons to promote visiting the clinic and the store. Intervention opportunities also arise seasonally. Examples include the promotion of back-to-school and vacation-prompting vaccinations, flu season shots with pneumonia piggy-backed on, spring and fall seasonal allergies, and national body part (i.e., Breast Cancer) of the month campaigns.
Why Retail Clinics as the Locus for Change?
Incumbents in the retail clinic space grow because their business case is compelling, enterprises are sufficiently capitalized and customer experiences are highly scored by all relevant satisfaction metrics. These operations are still in early growth facing normal start-up woes:
1. Uncertain ROIs and break-even points, staffing, information capture and work-flow patterns
2. “Without the doc” risk-averse service menus, voluntary script dispensing/selling firewalls, constrained spatial layouts and low-ball pricing.
Thus, there is plenty of wiggle room to now plan additional functionality as the kinks get worked out and consumer acceptance grows. As competition increases, investment drivers include the need for continuous product improvement and differentiation as well as for satisfying large customer cohorts shifting from latent to expressed demand for diagnostic, immunization and screening services. In-store worker-focused risk assessments add icing to the convenience cake, especially by filling in off-peak appointment slots, smoothing work flow and reducing queues and wait times. (Workers’ rewards must be nondiscriminatory per U.S. Department of Labor regs compared with customers’ rewards.)
Like Lipitor, the “daughter products” released after its ingestion are more beneficial than the original dose. Sensible protocol-based and decision-supported adult primary care is the core retail clinic output platform now in place. Providing appropriate consumer-assisting programs with health systems co-venturers builds upon sunk investments at low marginal cost.
In many urban and rural communities, the default locus for free “medical advice” has traditionally been the neighborhood pharmacist. The retail clinic can expand this tradition with one-on-one assistive and practical care in terms of fuller primary prevention services that are disease- or body-part specific.
Many screening and testing services have been battle-tested in drug stores, at health fairs and convention lobbies and within assorted clinics of all stripes. More recently, based on strong empirical evidence from workplace wellness settings, providing customized incentives and rewards is essential to “get people to the last mile” to initiate behavioral change. This might become an especially compelling strategy with the deployment of emerging home-based disease management products incorporating remote monitoring. Incentives could take many forms from reward programs to price discounts on in-store goods and services.
Convenient Primary Prevention Would Gain Equal Footing with Convenient Care
Given pervasive techno-chaos within the overall healthcare industry, it takes business discipline and standardization to harmonize appropriate processes and technology. Just consider the hundreds of options flowing from web-based and traditional programming in risk assessment and personal auditing and tracking programming including health risk appraisals, HSAs and derivative financial products, mini personal health records, electronic medical records, chronic disease management with remote monitoring, behavioral targeting and one-on-one relationship marketing and loyalty card systems.
Each of these now operate under different parentage – from health departments, governments, self-insured large employers, progressive unions, managed care organizations, classic insurers, marketing services firms and, increasingly, by customers themselves. Many have or will become zero-priced commodities. The good news is that all are adjunctive to enhancing the retail clinics’ care and caring missions.
The retail clinic could assume employers’ traditional role in health risk appraisal to get incentive packages, monitoring and benchmarking locked and loaded. Then, many follow-through tests and procedures are done in store with out-referral when appropriate. Record keeping would be online and really simple. It’s like installing training wheels for the emerging PHR and EMR systems. These convergent systems are typified by early developer groups such as WebMD while Google is constructing a PHR system.
Caring Processes are Inseparable from Care Processes
Retail Clinic 2.0 positioning is not glitzy PR to deflect the opening blows by organized physician groups that wrongly perceive negative competition from nurse practitioners and others. The reality is all PCPs (and, more importantly, their patients) will be universally better off if they begin to mimic some of the critical convenience, staffing, IT and pricing success factors put in place by the retailers.
The docs are far from being disintermediated; they can be emancipated from the routine sniffles and scratches while remaining wired in, utilizing their time and skills more appropriately and productively. Ditto for our under-funded public health clinics that will face huge work flow and staffing problems as prevention and wellness eventually obtain public and private core financing. Latent demand for the 55-year-olds and kids is likely to explode if Medicare expands down and SCHIP widens.
Recent AMA opening moves challenging the emerging retail clinic industry’s usurpation of physician roles and functions were inevitable. It’s fuming again but will lose the battle because:
1. Their economic self-interest becomes more visible than their patients’,
2. The inherent cost-effectiveness of the current approaches is readily apparent to customers (especially where services are insured), and
3. Business groups, governments, employers, public health associations and insurers all welcome price and quality competition wherever and whenever they find it.