At 7 p.m. on a Tuesday night, more than two hours after most pediatricians have closed their clinics for the day, Stephanie Johnson of East Hartford stepped into a ProHealth Physicians Express Care center in Glastonbury with her two children in tow. Her toddler was complaining of ear pain.
“I left work at 5, so this is the quickest way to get him to a doctor,” said Johnson. “I like this option; I don’t have to go all the way to Children’s for ear pain.”
In the past, when Johnson visited the emergency room at Connecticut Children’s Medical Center in Hartford, she said that she’s had to wait for more than two hours for her child to be seen by a doctor for earache.
“Here, we are in and out within an hour. I’m happy with the care—they call to follow up to make sure everything is fine, and they notify my regular pediatrician,” she said.
More than a dozen urgent care centers are expected to open statewide within the next year, including new collaborations with hospitals, and expansions of small, existing clinics to new locations. The demand for affordable, after-hours, high quality care is continuing to spur the expansion of these walk-in clinics, dubbed urgent care centers, in Connecticut and across the U.S. Such centers are attractive to hospitals looking to reduce their ER burden while expanding their patient network through referrals to in-house specialists and primary care physicians [PCPs]—and to investors with deep pockets seeking attractive returns.
Convenience is a factor in the demand for urgent care, but a 2016 age-based user survey by the Urgent Care Association of America (UCAOA) found that more than a quarter of 18- to 44-year-olds said cost was a major consideration in their choice of urgent care. Nearly half of all visits to urgent care centers result in an average charge of $155 per a 2011 UCAOA Benchmarking Survey, compared to the average cost of an ER visit at $1,423, according to a 2013 Medical Expenditure Panel Survey.
While consumers are seeing savings, investors are seeing profit. VMG Health estimates that industry revenue will grow between 2008 and 2018 from $11.1 billion to $18.8 billion. The UCAOA, based on its 2016 Benchmarking Survey, has seen a 10 percent increase in the total number of urgent care centers nationally since 2015, to 7,346 centers currently. Year-over-year data for Connecticut was not available.
Hospitals partnerships and private networks go head to head
Hospitals find that collaboration, rather than competition, works better in their favor in the urgent care industry. In February, Yale New Haven Health System announced a collaboration with PhysicianOne Urgent Care, a leading provider in the state with 12 centers in Connecticut, two in New York and four in Massachusetts. PhysicianOne is bankrolled by Pulse Equity Partners and PineBridge Investments, which has $80.3 billion in assets under management.
They’re opening in a market that’s already crowded with privately owned urgent care networks like the Birmingham, Ala.-headquartered American Family Care (AFC).
“I’m trying to duke it out with an $80 billion private equity fund,” said Tom Kelly, Connecticut president of AFC. The local centers are owned and operated by Connecticut entrepreneurs under a franchisee model. There are 10 AFC urgent care centers in Connecticut, with two more set to open next month in Danbury and Vernon.
The differentiator? “Patients come in and feel that we’re their neighbor,” Kelly said. “And we don’t serve a master. As an unaffiliated group, we can choose the best place to send patients—it gives us an opportunity to hold specialists and PCPs accountable. We’re not opposed to working with a hospital, but being beholden to a hospital is not the strategy for us.”
AFC is planning to open between 7 and 10 centers in Connecticut next year, and around the same number in 2019, at an average cost of more than $1 million per facility. Negotiations are currently underway at six different facilities – “It’s a fast-mover advantage,” Kelly said, while declining to divulge profit margins, referring instead to industry data of between 10 to 15 percent.
PhysicianOne, which opened nine centers in the last two years, plans to continue its expansion throughout the region and views its collaboration with Yale as being extremely beneficial to patients.
“Over 30 percent of the patients we see do not have a primary care physician and approximately 35 percent require a specialist. Our relationship with the Yale New Haven Health System will help patients access high quality, timely, cost-effective care,” said Lynne Rosen, chief executive officer at PhysicianOne, which expects to treat more than 170,000 patients this year.
Meanwhile Hartford HealthCare, one of Connecticut’s largest healthcare networks, which entered into a partnership with GoHealth Urgent Care in January of this year, opened its first center in Avon in May. Plans are underway to open at least 15 centers within the next 18 months across Hartford HealthCare’s service area.
Connecticut’s aging population aligns well with urgent care centers
According to the 2016 UCAOA Benchmarking Survey, Connecticut has 131 urgent care centers, but ranks highly overall for its population to urgent care center ratio. “This access to care for episodic and non-life threatening situations is especially crucial in Connecticut, as data shows that only 14.8 percent of the state’s primary care needs are met, based on number of healthcare professionals – the lowest in country,” said Shaun Ginter, a UCAOA board member.
The gap is expected to widen with the Association of American Medical Colleges estimating a shortfall of up to 43,000 PCPs nationwide by 2030, making it harder to find a new physician and schedule same-day appointments with existing providers—a factor that will further drive the expansion of urgent care centers and retail clinics statewide. Another driver is Connecticut’s aging population. The American Geriatric Society estimates that the number of individuals aged 65 and above will grow to 956,000 by 2030, up from 577,000 in 2015, and they would exert pressure on the demand side for healthcare services.
Dr. Michael Gutman, medical director and founder of New England Urgent Care, and his wife Yahel, a nurse, opened their first urgent care clinic in West Hartford in 2011. The group has since expanded to four more locations – Enfield, Simsbury, Bristol, and the newest, Manchester, which opened in May of this year. All locations broke even within two years, Gutman said—“We don’t have the overhead costs that hospitals have.”
His biggest selling point? The nurses are trained in emergency medicine. “We’ve had patients with heart attack, trauma, and gastro-intestinal bleeding—even by the time an ambulance arrives, patients have been stabilized by our emergency team to be transported to the ER.”
Per UCAOA data, 98 percent of patients who visit an urgent care clinic are in the right care setting; two percent need to be transported to the ER. Doctors are well aware that urgent care centers are not a substitute for patient visits with a regular primary care physician. In response to patient needs for regular care, Gutman is in the process of opening a primary care center adjacent to his urgent care clinic in Enfield.
In Connecticut, there is currently no law that states which practices can call themselves urgent care—all walk-in clinics are licensed as outpatient medical centers—although some individual businesses have obtained accreditation from the UCAOA. Competitors include St. Francis FastCare, which has clinics at Stop & Shop grocery stores, staffed by Advanced Practice Registered Nurses (APRNs); the national giant Concentra Urgent Care, formerly a subsidiary of Humana, Inc.; Connecticut Urgent Care, which is building community relationships at bike shows and Lions Clubs; and smaller players including Velocity Urgent Care in Rocky Hill and Southington; and Premier Urgent Care in Newington. Many urgent care centers accept uninsured patients and individuals covered by Medicaid, but several clinics decline to treat patients covered by Medicaid or Connecticut Husky plans.
“We attribute the continued growth of urgent care to the increased need in the marketplace, and the importance of urgent care in today’s healthcare system,” said UCAOA’s Ginter. “Urgent care centers provide a robust spectrum of care for immediate but non-emergency situations, treating everything from the flu and broken bones to asthma and concussion screening.”
He also said that while there is strong evidence that hospital systems continue to enter the urgent care sector as part of their ambulatory care strategy, the data does not reflect a growth trend.
Editor's note: This story was updated on May 31, 2017, to correct the industry growth rate predicted by VMG Health.