FEED-BACK.COM E-ZINE
January / February 2008
Volume 11 Issue 1
Retail Medicine
Retail clinics are the latest innovation sparking interest in retail medicine, a market which provides products and services directly to consumers. An example of the most consistent service segment is cosmetic procedures. In contrast, demand for cardiac and full-body scanning rose during the early 2000s and fell precipitously by the middle of the decade. Boutique, concierge, pay-as-you-go, retail, and retainer medicine are different terms that generally involve the same business model: Patients pay directly for products and services, eliminating the paperwork and reimbursement issues associated with insurance and managed care plans.
Access To Health Care
An article in the Journal of Healthcare Management [1] identifies retail medical clinics as an emergent new model for delivering health care services, one which may alleviate some disparities. According to reports generated by the Agency for Healthcare Research and Quality (AHRQ: http://www.ahrq.gov/) from 2003 through 2005, major barriers were identified (economic, geographic location, and lack of insurance). The latest findings (2006) indicate that access to care has improved for Asian, black, and low-income populations, but quality-of-care disparities remain high for Hispanics. For those who can afford to pay for such services, retail clinics represent a viable option.
Revenue Generation For Hospitals
In November 2007, an article published by the Business Journal of Milwaukee examined the role of "retail medicine" as a source of extra revenues to make up for the decline in insurance reimbursement payments.[2] Typically, coffee and gift shop offerings generate less than one million annually. Hospitals and clinics can expand the mix to include a wider range of health-related products and services that are sold directly to patients. Successful implementation of retail medicine generates annual revenues in the $5.0 million - $15.0 million range.
Sustaining Or Supplementing A Medical Practice
As physicians face increased administrative paperwork and reduced reimbursement levels, retail medicine offers some respite. As noted in an article published by The New Physician in October 2005, physicians provide services to between 2,500 and 7,000 patients each year.[3] Day-to-day operations may not provide the challenges and rewards that physicians initially expected from running a medical practice. Annual income may not be sufficient, either.
Anecdotally, many physicians who spoke at the Medical Spa Conference (November 2003) considered making the switch in order to spend quality time with their patients and to incorporate mind-body medicine into their practices.[4] The New Physician article explained why practitioners have those sentiments — family physicians and general internists spend an average of eight minutes with patients (estimates attributed to the American Medical Association in the article).
One option is for patients to pay annual fees to enhance access to the physician and his/her services (by telephone, in the office, or in the patient's home). According to the Society for Innovative Medical Practice Design[5], "concierge medicine" (with annual fees) may be best suited to physicians with fifteen or more years of experience and a sufficient pool of total patients from which to draw the several hundred who will opt for the specialized service.
[1] "Retail Medicine: The Cure for Healthcare Disparities", Journal of Healthcare Management, July-August, 2007 (available as a trade journal article at: www.entreprenuer.com).
[2] "A New Source Of Revenues For Hospitals, Clinics", Business Journal of Milwaukee, November 2007 .
[3] "Physicians Explore Their Options In Retail Medicine", The New Physician, October 2005.
[4] "Highlights from the Medical Spa Conference", Medical Spa & Specialty Hospital Markets, Feedback Research Services (September 2003) [Out-of-print].
[5] http://www.simpd.org/about/
