Convenience Care:Convenience Care: “You’re sick. We’re “You’re sick. We’re

quick.”quick.”¹¹

Presented byPresented by

Stephen C. Waldhoff, FACHEStephen C. Waldhoff, FACHE

¹MinuteCare, Michael Howe, CEO¹MinuteCare, Michael Howe, CEO

AcknowledgementsAcknowledgements

Albert Lea Medical Center – Albert Lea Medical Center – Mayo Health Mayo Health SystemSystem

– Karen Conn, Administrative AssistantKaren Conn, Administrative Assistant– Ginny Larson, Clinic AdministratorGinny Larson, Clinic Administrator– Steve Underdahl, Hospital AdministratorSteve Underdahl, Hospital Administrator

Michael Howe, CEO – MinuteClinicMichael Howe, CEO – MinuteClinic Charles Liedtke, Ph.D., University of MNCharles Liedtke, Ph.D., University of MN John Vollum, The Wellspring GroupJohn Vollum, The Wellspring Group

Background InformationBackground Information

Changing healthcare market Changing healthcare market conditionsconditions– Niche medicine movementNiche medicine movement– Consumer driven retail modelConsumer driven retail model

Retail medicine appealRetail medicine appeal– ConvenienceConvenience– CostCost– Appointment accessAppointment access

ObjectivesObjectives

IntroduceIntroduce and become familiar with the and become familiar with the concept of retail medicineconcept of retail medicine

UnderstandUnderstand the driving market forces the driving market forces behind convenience clinicsbehind convenience clinics

GainGain an appreciation for the impact this an appreciation for the impact this care model will create for traditional care model will create for traditional medicinemedicine

Suggest Suggest some potential take-home business some potential take-home business plan strategiesplan strategies

Assess Assess how one rural healthcare system is how one rural healthcare system is responding to retail medicine initiativesresponding to retail medicine initiatives

OverviewOverview

1.1. Concept DescriptionConcept Description

2.2. ImplicationsImplications

3.3. Potential StrategiesPotential Strategies

4.4. Albert Lea Medical Center (ALMC) Albert Lea Medical Center (ALMC) Express Care ModelExpress Care Model

5.5. QuestionsQuestions

Convenience Convenience CareCare

Concept DescriptionConcept Description

DefinitionDefinition

“A walk-in neighborhood medical clinic in retail locations where certified nurse practitioners diagnose and treat select common family illnesses using defined medical protocols.”

(PR Newswire US, 02-02-05)

OriginOrigin

Consumer driven conceptConsumer driven concept -- Convenience -- Accessible-- Convenience -- Accessible

-- Quick-- Quick -- Little or no out-of- -- Little or no out-of-pocket costpocket cost

-- Low Cost-- Low Cost -- Consumer empowerment -- Consumer empowerment

-- Simple-- Simple

Founded in 2000Founded in 2000 Minneapolis BasedMinneapolis Based

Origin Origin (cont.)(cont.)

MinuteClinic – early pioneer/founderMinuteClinic – early pioneer/founder– One physician and two investorsOne physician and two investors– Partnered with TargetPartnered with Target

Opened a kiosk in Towson, MarylandOpened a kiosk in Towson, Maryland

– 19 Minnesota locations19 Minnesota locations– Contracted directly with Best Buy and Contracted directly with Best Buy and

Guidant Corporation with on-site medical Guidant Corporation with on-site medical kiosk serviceskiosk services

– 84 locations in 10 states84 locations in 10 states– 300 clinics in 22 states by year end300 clinics in 22 states by year end

Origin Origin (cont.)(cont.)

CVS CorporationCVS Corporation– Acquiring MinuteClinic for $170 MillionAcquiring MinuteClinic for $170 Million– 6,100 retail and specialty pharmacy 6,100 retail and specialty pharmacy

storesstores– Currently 66 CVS stores with a Currently 66 CVS stores with a

MinuteClinicMinuteClinic– 450-500 locations or more by 2007450-500 locations or more by 2007

Retail LocationsRetail Locations

Partnerships are emerging Partnerships are emerging nationwidenationwide

Well-known retailers:Well-known retailers:-- Wal-Mart-- Wal-Mart -- Hy-Vee-- Hy-Vee

-- Target-- Target -- Albertsons-- Albertsons

-- Kroger-- Kroger -- Cub Foods-- Cub Foods

-- CVS-- CVS -- Osco Drug-- Osco Drug

-- Rite Aid-- Rite Aid -- Save-On Pharmacy-- Save-On Pharmacy

Convenience Clinic BrandsConvenience Clinic Brands

Express CareExpress Care MinuteClinicMinuteClinic MinuteCareMinuteCare FastCareFastCare Little ClinicsLittle Clinics Quick ClinicQuick Clinic

MedSpotMedSpot Ready ClinicReady Clinic Wellness Wellness

Express ClinicExpress Clinic Take CareTake Care Redi ClinicRedi Clinic

Attributes - Attributes - ClinicalClinical

Employ a Nurse PractitionerEmploy a Nurse Practitioner Treat non-emergent conditionsTreat non-emergent conditions Conduct physicalsConduct physicals Offer routine testsOffer routine tests Utilize algorithm based clinical Utilize algorithm based clinical

pathwayspathways Physician supervisedPhysician supervised Referrals offeredReferrals offered

Attributes - Attributes - OperationalOperational No appointment necessaryNo appointment necessary Open 7 days a week with extended Open 7 days a week with extended

evening hoursevening hours Sophisticated computer software utilizedSophisticated computer software utilized Easy consumer accessEasy consumer access Personal and attentive staff naturePersonal and attentive staff nature Available medical menus with posted Available medical menus with posted

pricingpricing Offer beepersOffer beepers Kiosks measure 10 ft. x 12 ft.Kiosks measure 10 ft. x 12 ft.

Attributes - Attributes - AdministrativeAdministrative Convenient locationsConvenient locations Low overheadLow overhead Limited square footage Limited square footage (110 - 440 sq. (110 - 440 sq.

ft.)ft.) Priced well below traditional Priced well below traditional

healthcare optionshealthcare options Covered by most insurance plansCovered by most insurance plans Promise patients an average waiting Promise patients an average waiting

time of 15 minutestime of 15 minutes

Clinical SafeguardsClinical Safeguards

Utilize Utilize Masters prepared Nurse Masters prepared Nurse PractitionersPractitioners

FollowFollow evidence based clinical evidence based clinical protocols with treatment algorithmsprotocols with treatment algorithms

SupervisedSupervised by a physician (M.D.) by a physician (M.D.) Medical DirectorMedical Director

AvailableAvailable physician consultation physician consultation Offer Offer referrals to primary and referrals to primary and

secondary care providerssecondary care providers

Clinical Safeguards Clinical Safeguards (cont.)(cont.)

Avoid Avoid treating children younger than 18 treating children younger than 18 months or people with chronic diseasesmonths or people with chronic diseases

MaintainMaintain complete patient records complete patient records FaxFax records to the patient’s primary care records to the patient’s primary care

provider to ensure treatment continuityprovider to ensure treatment continuity Patients returning with the same medical Patients returning with the same medical

complaint are flagged by the computer complaint are flagged by the computer systemsystem

Protocols prevent Nurse Practitioners from Protocols prevent Nurse Practitioners from prescribing antibiotics without a positive prescribing antibiotics without a positive test resulttest result

Urban vs. Rural SensitivitiesUrban vs. Rural Sensitivities

Urban communities are Urban communities are attractiveattractive marketsmarkets

Rural locations have Rural locations have appealappeal– Regional shopping venuesRegional shopping venues– Close proximity to larger Close proximity to larger

communitiescommunities– Physician under served areasPhysician under served areas– Little or no competitionLittle or no competition

Market Appeal Market Appeal and and

Consumer Consumer ReactionsReactions

The Three “P’s” of MarketingThe Three “P’s” of MarketingApplied to Convenience Care Applied to Convenience Care

ClinicsClinicsPProductroductPPrice rice PPositionosition

PProductroduct

Consumer acceptance/empowermentConsumer acceptance/empowerment– Options/choicesOptions/choices– ConvenienceConvenience– Appeal to working mothersAppeal to working mothers– Quality careQuality care– Timely: “You’re sick. We’re Quick.”Timely: “You’re sick. We’re Quick.”– AffordableAffordable

PPricerice¹¹

Typical primary care visit cost Typical primary care visit cost $109$109 Emergency Room visit costs Emergency Room visit costs $328$328 Urgent Care visit costs Urgent Care visit costs $125$125 Convenience Care fees:Convenience Care fees:

– FastCareFastCare $38$38– QuickClinicQuickClinic $39$39– MinuteClinicMinuteClinic $44$44– MedSpotMedSpot $40$40

¹ ¹ MN Council of Health PlansMN Council of Health Plans

PPositionosition Typical locations:Typical locations:

– Shopping CentersShopping Centers– Grocery StoresGrocery Stores– Retail CentersRetail Centers

Target MarketTarget Market– Cash customersCash customers

Only 5% of MinuteClinic patients are 60 years +Only 5% of MinuteClinic patients are 60 years +– Ages 18 months – 64 yearsAges 18 months – 64 years– Process insurance claimsProcess insurance claims

Some companies are reducing or waiving deductiblesSome companies are reducing or waiving deductibles– U.S. Bank in MinneapolisU.S. Bank in Minneapolis

– Individuals with HSA’sIndividuals with HSA’s ConsumerismConsumerism

– Career singles, students, and familiesCareer singles, students, and families

Wall Street Journal by HarrisWall Street Journal by HarrisInteractive SurveyInteractive Survey1

2,245 adults surveyed2,245 adults surveyed Convenience (92% satisfied)Convenience (92% satisfied) Quality of Care (89% satisfied)Quality of Care (89% satisfied) Staff Qualifications (88% satisfied)Staff Qualifications (88% satisfied) Cost (80% satisfied)Cost (80% satisfied)

1 October 2005

Consumer ReactionConsumer Reaction ““Patients think it’s a great alternative to an Patients think it’s a great alternative to an

emergency room.” emergency room.” Rhonda DukeRhonda Duke

““I thought they were very friendly and helpful. I thought they were very friendly and helpful. More convenient than having to wait elsewhere.”More convenient than having to wait elsewhere.”

Kristy ParrishKristy Parrish

““I think it’s a good idea. It’s convenient, and I think it’s a good idea. It’s convenient, and sometimes you just don’t need to see a sometimes you just don’t need to see a physician.” physician.” Walter FosserWalter Fosser

““What I like about this is, it’s hitting people where What I like about this is, it’s hitting people where they live, work, and shop. The advantage of it is they live, work, and shop. The advantage of it is that it’s the right kind of care at the right time.” that it’s the right kind of care at the right time.”

Mike WalkerMike Walker

Implications for Implications for Traditional Traditional MedicineMedicine

Potential Healthcare Industry Potential Healthcare Industry ConsequencesConsequences

Fragmentation - a possible/likely Fragmentation - a possible/likely outcomeoutcome

Lost market shareLost market share Patient panel erosionPatient panel erosion Financial lossFinancial loss

– Heavy private pay concentrationHeavy private pay concentration– Loss of overhead coverageLoss of overhead coverage

Primary care provider threatPrimary care provider threat

Market Potential for Market Potential for Retail Health ProvidersRetail Health Providers

“The MinuteClinic concept represents an almost indescribable potential for growth.” Michael Howe, CEO

MinuteClinic

Potential Potential Healthcare Healthcare

Industry Industry StrategiesStrategies

Questions to ConsiderQuestions to Consider

What is our business?What is our business? How can we best meet the needs of How can we best meet the needs of

patients?patients? Should we position ourselves to Should we position ourselves to

compete?compete? What should we consider doing?What should we consider doing? Are there any viable options?Are there any viable options?

Healthcare Industry OptionsHealthcare Industry Options

1.1. Co-ExistCo-Exist– Do nothing approachDo nothing approach– Accept consequencesAccept consequences

2.2. CollaborateCollaborate– Respond by working with othersRespond by working with others– Stratify existing fees based upon Stratify existing fees based upon

patient acuity levelspatient acuity levels– Become more customer friendlyBecome more customer friendly

Healthcare Industry OptionsHealthcare Industry Options(cont.)(cont.)

3.3. Partner/Acquire AssetsPartner/Acquire Assets– Establish an equity position with other Establish an equity position with other

providersproviders– Buy an established businessBuy an established business

4.4. CompeteCompete– Open a de novo businessOpen a de novo business– Establish kiosks in high density Establish kiosks in high density

consumer traffic areasconsumer traffic areas– Become more visible by creating a Become more visible by creating a

consumer driven model that is consumer driven model that is responsive to the changing market responsive to the changing market placeplace

ALMC Case ALMC Case ExampleExample

Guiding PrinciplesGuiding Principles Care provided in a retail settingCare provided in a retail setting Care provided for limited diagnosesCare provided for limited diagnoses Care provided by nurse practitionersCare provided by nurse practitioners Minimal offered ancillary supportMinimal offered ancillary support Care provided within a limited Care provided within a limited

timeframe timeframe Care is focused on immediate need Care is focused on immediate need

(rather than preventative health)(rather than preventative health) Posted charges and point-of-care Posted charges and point-of-care

paymentpayment Paperless environmentPaperless environment Serve as an innovative incubator Serve as an innovative incubator

Why Now?Why Now? Significant retail medicine growth in metro Significant retail medicine growth in metro

areas and spreading in out-state areas areas and spreading in out-state areas (Winona & Mankato)(Winona & Mankato)

Minnesota now allows N.P.s to practice Minnesota now allows N.P.s to practice independentlyindependently

Albert Lea retail corridor appears to be an Albert Lea retail corridor appears to be an ideal setting for a Convenience Care modelideal setting for a Convenience Care model

Anticipate Albert Lea Wal-Mart will follow Anticipate Albert Lea Wal-Mart will follow the direction of retailersthe direction of retailers

One-Third of local survey respondents One-Third of local survey respondents indicated they would use this new serviceindicated they would use this new service

Potential ALMC Potential ALMC Convenience Care Model Convenience Care Model

Patients referred to ALMC primary Patients referred to ALMC primary care for:care for:– Acute care diagnosisAcute care diagnosis– Follow up careFollow up care– Extensive lab, radiologyExtensive lab, radiology

120 – 140 sq. ft. kiosk located 120 – 140 sq. ft. kiosk located within an existing retail locationwithin an existing retail location

Potential DiagnosesPotential Diagnoses

LimitedLimited Posted along with chargesPosted along with charges

Potential Diagnoses Potential Diagnoses (cont.)(cont.)

Common Common IllnessesIllnesses– Pink eyePink eye– Ear infectionsEar infections– Sinus infectionsSinus infections– Strep ThroatStrep Throat– Allergies Allergies (over 6 years)(over 6 years)

– Bladder infections Bladder infections (females age 12-65(females age 12-65))

– Bronchitis Bronchitis (age 10-65)(age 10-65)

Additional Additional TreatmentsTreatments– Flu Flu (ages 10-65)(ages 10-65)

– LaryngitisLaryngitis– MonoMono– Pregnancy TestingPregnancy Testing– Swimmer’s EarSwimmer’s Ear– Minor lacerationsMinor lacerations

Potential Diagnoses Potential Diagnoses (cont.)(cont.)

Skin InfectionsSkin Infections– Athlete’s footAthlete’s foot– Cold SoresCold Sores– Deer Tick Bites Deer Tick Bites (over (over

age 12)age 12)

– Minor skin Minor skin infections, burns, infections, burns, rashes, poison ivy, rashes, poison ivy, ringworm, wart ringworm, wart removal, swimmer’s removal, swimmer’s itchitch

VaccinesVaccines– Diphtheria, Diphtheria,

Tetanus, PertussisTetanus, Pertussis– FluFlu– HepatitisHepatitis– PolioPolio– MMRMMR– MeningitisMeningitis– TdTd

GoalsGoals

Meet operating expensesMeet operating expenses GenerateGenerate

– Referrals to ALMCReferrals to ALMC– Positive patient satisfaction scoresPositive patient satisfaction scores– Positive patient outcomesPositive patient outcomes– Effective patient utilizationEffective patient utilization

Goals Goals (cont.)(cont.)

ALMC Innovation CenterALMC Innovation Center– Automated drug distribution Automated drug distribution

dispensing systemdispensing system– Physician referral resourcePhysician referral resource– Medical education and information Medical education and information

kioskkiosk

Exit StrategyExit Strategy

The expected goals will be reviewed The expected goals will be reviewed quarterly by the Clinical Practice quarterly by the Clinical Practice Committee for the first year and Committee for the first year and other appropriate review bodies other appropriate review bodies annuallyannually

If the goals are not met on a If the goals are not met on a consistent basis, an exit strategy will consistent basis, an exit strategy will be implementedbe implemented

One year space leaseOne year space lease

Questions?Questions?