The " Proximity Advantage " Enjoyed by Retail, Walk-In Clinics Over Health Systems

This article caused me to reflect on what I will call the"proximity advantage" held by the rapidly expanding walk-in clinics in drug stores and Walmart. As noted above, CVS and Walgreens combined have about 20,000 stores in the U.S. which means that one of them will always be very close to the vast majority of American healthcare consumers. This proximity to consumers provides a distinct advantage over hospitals in the competition for primary care patients. In addition, these clinics are beginning to offer services to a broader range of patients. When it purchased Aetna, CVS announced that it would begin to care for patients with chronic diseases, referring to a community-based care model (see:Merged CVS and Aetna Will Move Toward a Community-Based Healthcare Model). By way of comparison, large health systems are offering fewer primary care services because of the lower profit margins associated with them (see: Walmart Health: A Deep Dive into the $WMT Corporate Strategy in Health Care). Here is a quotation from this article that discussed Walmart's strategy for its Care Clinics compared to hospitals:Walmart ’s retail strategy in health care is based on the hospital inefficiency in innovation and the business theory of bundling and unbundling services. The vast majority of hospital revenue is rooted in the fee-for-service business model  ....Providers are thus incentivized to provide a high-volume, high-cost standard of care, squeezing mone...
Source: Lab Soft News - Category: Laboratory Medicine Authors: Tags: Healthcare Business Healthcare Delivery Healthcare Innovations Healthcare Insurance Hospital Financial Medical Consumerism Quality of Care Source Type: blogs