Retail clinics may be creating new demand that increases the cost of health care rather than reducing medical spending.

Retail Clinic Visits for Low-Acuity Conditions Increase Utilization and Spending

Published in: Health Affairs, v. 35, no. 3, Mar. 2016, p. 449-455

by J. Scott Ashwood, Martin Gaynor, Claude Messan Setodji, Rachel O. Reid, Ellerie Weber, Ateev Mehrotra

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Research Questions

  1. Do retail health clinics—located in pharmacies, grocery stores, and big-box stores—help reduce health care spending (because they cost less) or increase it (because people are seeking more care)?
  2. Are people seeking care at retail clinics as a substitute for the more expensive care they get at a doctor's office or an emergency room?
  3. Or, are the perceived convenience and lower cost of retail clinics encouraging people to seek (new) care that they otherwise would have gone without?

Retail clinics have been viewed by policy makers and insurers as a mechanism to decrease health care spending, by substituting less expensive clinic visits for more expensive emergency department or physician office visits. However, retail clinics may actually increase spending if they drive new health care utilization. To assess whether retail clinic visits represent new utilization or a substitute for more expensive care, we used insurance claims data from Aetna for the period 2010-12 to track utilization and spending for eleven low-acuity conditions. We found that 58 percent of retail clinic visits for low-acuity conditions represented new utilization and that retail clinic use was associated with a modest increase in spending, of $14 per person per year. These findings do not support the idea that retail clinics decrease health care spending.

Key Findings

  • Roughly 40 percent of visits to retail clinics for minor medical issues were in lieu of visits to a doctor's office or urgent care facility: this lowered spending for health plans and patients.
  • But the majority of visits (nearly 60 percent) were for routine medical care that patients otherwise would not have sought: this represented an increase in utilization of services.
  • The increased spending from higher use of services outweighed the savings that resulted when patients went to cheaper retail clinics instead of a doctor's office or an emergency room.
  • Overall, the use of retail clinics for minor medical issues was associated with about a 20 percent increase in spending, or, an increase of about $14 per person per year.

Recommendation

Further research should investigate how retail clinics affect the coordination of care, care for chronic illnesses, and overall spending.

Access further information on this document at Health Affairs

This article was published outside of RAND. The full text of the article can be found at the link above.

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