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Study: Retail clinics hike health insurer costs

Convenient care options cause a spike in utilizaiton

Contrary to what some health insurers and policymakers believe, retail clinics actually increase spending by driving new healthcare utilization, according to a new study published by Health Affairs.

In the study, researchers led by the RAND Corporation's J. Scott Ashwood studied claims data from 13.3 million Aetna enrollees from 2010 to 2012 to track utilization and spending for 11 "low-acuity" conditions.

They found that 58 percent of retail clinic visits for low-acuity conditions represented new utilization--or patients seeking care when they otherwise would not have--compared to the 42 percent that were substitution, in which patients visit a retail clinic instead of a physician office or emergency department (ED).

Thus, retail clinic use was associated with 21 percent higher spending for low-acuity conditions, or an increase of $14 per person per year. But the study points out that annual per-person spending on low-acuity conditions--$35 for retail clinics and $46-$66 for physician offices and EDs--is just a small share of the per capita spending on healthcare in the United States, which averaged $8,927 in 2012.

Insurers are increasingly striving to educate their members about low-cost alternatives to the ED, with previous research indicating that by covering members' visits to retail clinics, insurers can save more than $200,000 each year due to fewer ED visits and hospital admissions.

It's also unclear whether retail clinics' connection to higher utilization and spending is positive or negative, the study authors write. The use of this type of provider could in theory prevent expensive complications down the road by treating an illness earlier, as well as free up physicians in traditional settings to handle more complicated cases.

Insurers, however, might not see the uptick in utilization as valuable, as retail clinics only recently have started adding chronic illness care to their more common offerings such as immunizations, physicals and cholesterol screenings, the study says. In addition, retail clinics have been shown to disrupt continuity of care, which can be critical for patients managing chronic conditions.

Ultimately, the study authors say their findings "should help inform payers' coverage decisions for retail clinics and other care options that increase convenience and access."

Already, insurers have increased their coverage for retail clinic visits, with CVS and Walgreens reporting that the large majority of visits to their clinics are now covered by health plans.  

To learn more:
- here's the study (subscription required)

Related Articles:
Health insurers now cover most retail clinic visits
Retail clinics to surpass 2,800 in next two years
Clinics can lower costs for payers and providers
Insurers encourage less-costly ER alternatives