Health System Growth: The Modern Urgent Care Platform

Patients increasingly demand care be delivered how and when they want it. Health systems that deliver on this demand are rewarded with patients' trust and loyalty. Building a modern urgent care platform delivers on this demand.

This content is sponsored by Health System Advisors.

At the first healthcare touch points, this patient loyalty and trust gets converted into downstream referrals. While downstream steerage generated by consumer preference is dwarfed by the steerage generated by clinician recommendations, it is the consumer that is making the choice about where, when, how and with which clinician the first healthcare touch point will occur. Once that first touch point has occurred, studies show the vast majority (83 percent) will follow that provider's clinical referrals.¹ As such, the first healthcare touch point has unique influence. 

In a competitive environment, whoever controls the first touch points will be able to best influence the secondary decisions and thereby garner the largest share of patient relationships.

Historically, first touch points have been either in physician offices or emergency rooms. As health systems seek to influence patients' healthcare decisions, strong primary care physician enterprises are developing. Unfortunately, traditional, scheduled clinics are finding it hard to adapt to the growing demands for convenience from younger, well-insured populations. Instead of building their delivery model around the desires of the patient, most traditional clinics are built around maximizing provider schedules and the clinical needs of the patient; convenience has taken a back seat.

As a result, an ever-growing portion of first healthcare touch points are occurring in channels like urgent cares, often outside the traditional health systems' sphere of influence.

Health systems wanting relationships with these younger, privately insured populations must be willing to meet them where they are along their healthcare journey. Regardless of the clinical enterprise's desire to connect everyone with a long-term physician relationship, responsive health systems will recognize they cannot form loyal relationships through experiences which leave the individuals unsatisfied.

A health system-developed modern urgent care platform is a solution to one of the major first touch delivery channels.

Modern urgent care characteristics

The modern urgent care platform is distinctly different from legacy urgent care models. The modern platform is designed first around the patient's needs. Combining convenience, access, predictability and clinical needs, modern urgent care platforms offer a segment of the population the approach to care that they have been demanding. As a result, characteristics of the modern urgent care platform reflect both high levels of patient satisfaction and standalone economic results.

Unlike the legacy urgent care sites which health systems have typically operated at a loss and with low patient satisfaction, the modern urgent care platform is a clinically appropriate, safe, effective and standalone profitable model designed around the needs and desires of each individual.

Modern urgent care opportunity

Across the U.S., a late 2016 study of urgent care supply and demand by Urgent Care Partners demonstrated a 22 percent shortage of urgent care sites in markets suitable for profitable urgent care sites. This translated to a need for 1,600 additional urgent care sites to meet demand.²

Reviewing undersupplied markets identified in the 2016 Urgent Care Partner's study — including central Illinois, St. Louis, Seattle, Spokane, WA., Bismarck N.D., and southern California — shows significant new urgent care site development has occurred since late 2016. For example, since the study was completed, two providers in St. Louis — Total Access Urgent Care and the Mercy/ GoHealth partnership — have already added 17 sites, while reportedly planning to add nearly 20 more.

Clearly the demand for urgent care continues to grow and outstrip supply.

Moreover, a modern urgent care platform will strip volume and patient preference from any of the approximately 6,000 legacy models currently being operated today. 

Because urgent care is mostly a commodity service, individuals are typically ruthless about their choices of urgent care sites. In markets where patients once tolerated 60-minute wait times at 5 pm, they no longer tolerate these long wait times when a high-quality alternative with no wait time becomes available. Again and again, we see examples of legacy urgent care sites with Google and Yelp ratings in the mid-threes operating under capacity in a market where a modern model subsequently enters and thrives. For example, UnityPoint Health opened a modern model in a north central Iowa market thought to be saturated with legacy urgent care models. Within three months, the pilot site was so well received it achieved operational capacity while the legacy clinics lost volumes. 

With the immediacy of social media, individuals will quickly distinguish between inefficient, poor-service urgent care sites and those that operate a modern model. For patients, the effort to switch and use a different urgent care site is low. As such, modern urgent care sites are quickly rewarded with volume and loyalty, while legacy models are punished.

In markets where Urgent Care Partners has partnered with health systems, modern urgent care sites have captured typically one-quarter to one-third of the existing legacy urgent care clinic volumes within 12 months. As health systems develop more modern urgent care platforms, Urgent Care Partners expects as much as half of the legacy urgent care volumes will be captured by these new models.

Can health systems effectively operate a modern urgent care platform?

The concern health system cannot operate consumer-sensitive services like urgent care should be challenged. A health system will not thrive in an information-rich environment where patients have more and more input into their own care models unless they can adapt to serving the evolving patient convenience and service demands. Granted the historical capabilities needed to operate a typical hospital and high complexity ambulatory health system platform are not the same as those needed to operate a modern urgent care platform, however, we reject the notion that this will forever be the case. In fact, a persuasive argument can be made that health systems must develop capabilities similar to those needed in a modern urgent care center for their hospital and complex ambulatory operations. Capabilities such as: customizing care to different needs, improving service, creating process efficiency, creating better access and forming relationships are quintessential for securing patient satisfaction and loyalty. 

However, health systems will not develop these capabilities without help. This leaves two major options for health systems:

1. Joint venture. Form a business partnership, typically a joint venture, with an urgent care provider to build urgent care sites for the health system. While this has been the dominant approach taken by health systems, it creates an arm's length relationship between the hospital and the joint venture and presents barriers for the health system to translate capabilities developed through the urgent care experience into other departments. A joint venture also limits the investment's transfer of funds to support streamlined referrals and the formation of health system patient relationships.

Mercy is a good example of a successful modern urgent care platform joint venture. By entering into a joint venture with GoHealth, they have been able to add nine sites in competitive St. Louis markets with a proven model with up to 30 sites being developed system wide.

2. Partner. Purchase or contract with urgent care partners who have the capabilities needed to develop a modern urgent care platform. Under this option, the health system partners to create, within the health system, capabilities needed while building the urgent care sites. Health systems have contracted with organizations like Urgent Care Partners (urgentcarepartners.com) to teach their staff and guide them through the process of developing large modern urgent care platforms with great success. Others have purchased modern urgent care sites and attempted, with generally less success, to scale the acquisition.

Tacoma, Wash.-based MultiCare Health System is a great example of a health system that successfully contracted to build modern urgent care capabilities inside the organization. In less than two years, MultiCare, by working with Urgent Care Partners, added 33 modern urgent care sites and captured the internal capabilities to develop their next phase of 18 new sites internally.

In either case, health systems must both develop an urgent care platform and engrain the capabilities into the health system's culture to capitalize on the urgent care growth trend.

Conclusion

Developing new patient relationships requires health systems have the capabilities and services desired by those individuals. Health systems can create capabilities to serve young, insured patients at their first healthcare touch points. With as many as 4,600 new urgent care sites expected in the next decade, the modern urgent care platform offers health systems a low-risk, exciting and financially accretive option. Take advantage of that option, by finding your urgent care partners to accelerate your success.

Will Elder is an engagement manager at Urgent Care Partners and Luke Peterson is a Principal at Health System Advisors. For more information contact Luke at Luke.Peterson@ HealthSystemAdvisors.com

References
¹ Forrest, Christopher B et al. "Specialty referral completion among primary care patients: results from the ASPN Referral Study" Annals of family medicine vol. 5,4 (2007): 361-7.
² Beckner, Chiara and Peterson, Luke C. "Urgent Care Demand in 2016" Becker's Hospital Review August 24, 2016