|By Bill Toland, Pittsburgh Post-Gazette|
|McClatchy-Tribune Information Services|
There are five MedExpress urgent care clinics within a short drive, one in each of the cardinal directions and another right in town. To the south, there's also a St. Clair Urgent Care clinic, as well as a Medi-Help clinic on
Convenient, for sure -- and also illustrative of the suburban saturation of such clinics, which typically treat minor injuries and common colds.
The U.S. has around 9,500 urgent care clinics, with more opening every month thanks to under-50 patients who want on-demand care rather than a two-day wait for an appointment. Like most bricks-and-mortar commercial enterprises, urgent care clinics want to be where the customers are; to date, that's meant setting up shop in well-heeled, well-insured suburbs.
"That's where the reimbursement has been," said
The past 10 years have been spent rapidly building up the urgent care and convenient care industry, populating the towns that have the greatest profit potential and picking the lowest-hanging fruit, he said. But the coming decade will be a period of transition, testing new geographies, new ownership and new business models that will blur the line between old-fashioned primary care and newfangled, episodic urgent care.
Geographically, urgent care growth has mostly occurred in Midwestern and
But there's room for additional growth if urgent care operators can find a way to turn a profit in underserved areas.
Those areas tend to be at both ends of the spectrum; on one end are rural and inner-city areas where patients are more likely to rely on
While there's room for growth in secondary, less-profitable markets, that growth is increasingly likely to be driven by larger operators, either by way of new construction or acquisitions.
"The mom-and-pops will be bought out and brought under major brands," said
Acquisitions like that will be more common in what is now a fragmented market with just a few major players at the top.
About half of the urgent care clinics are the so-called mom-and-pops -- doctors groups or local investors that own one, two or three clinics. As they grow into regional chains, they become ripe for acquisitions by larger players.
Those larger players, historically, have been steered by private equity. MedExpress, based in
But investment firms and venture capital groups don't want to park their money for long -- they are always looking for an exit strategy. That means selling when the interest, and the value, is highest.
That apex could come a few years from now, said
For all the sector's potential as an alternative to primary care, episodic care "is heavily leveraged toward respiratory ailments and flu seasons,"
"That's a challenging environment to be a seller in,"
But if 2014 and 2015 are heavy cold and flu seasons and revenues are strong, capital will "start going toward the exits," he said.
At that point, the likely buyers may be those with the largest stakes in the health care enterprise -- insurers and hospitals,
As standalone clinics and regional groups consolidate, the big chains will become more attractive to the multistate health giants. Concentra,
"Insurers look at this industry as an ER diversion tactic," keeping claims costs down,
No matter the ownership model, the clinics themselves seem primed to evolve. They're shifting from episode-by-episode treatment centers to more fully integrated parts of the health care system linked to insurers, specialists and primary care doctors by way of electronic medical records and cross-country health information exchanges.
There will be a "blurring of the lines" between urgent care and primary care,
The "stand-alone" clinic will no longer stand alone,
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