Urgent Care Gets Boost from Medicare

We continue to see evidence of the opportunity era in healthcare — this period of transformation creating opportunities for innovators and forward-thinking organizations to deliver status quo-breaking products and services. Take for instance, the positive outlook for convenient care clinics. It’s a segment that is not only growing in scale, but it’s also riding the brisk tailwinds that come along with a Smart Health Market.

The urgent care and retail clinic models have been successful because they meet the rising demand for routine ambulatory care with patient-centered convenience. Consumers of all ages love the easy access of walk-in clinics, especially during evenings or weekends when the doctor’s office is closed.

Also, the cost of a visit is far less than going to a hospital emergency department. As we’ve said before, an average ED visit could cost 80% more than a visit to the neighborhood urgent care.

That’s why it’s not surprising that in 2018, the number of urgent care centers grew 8% to a total of 8,774. Trends indicate that as many as 500 new sites open each year (Urgent Care Association). The centers are also seeing more patients than ever, with utilization increasing 14% in 2017 alone. By comparison, use of the emergency department fell 2% (FAIR Health).

All this fresh data tells us the $18 billion urgent care market is pretty solid right now. However, the next boost we see coming in the near future might actually surprise you.

Medicare launches ET3

In a new demo, Medicare is going to start incentivizing ambulance service providers to take patients to alternative destinations — such as urgent care centers — instead of hospital emergency departments for non-emergency situations. That’s right: When 72-year-old Ann has a sore throat and calls 9-1-1, paramedics will be able to triage her to a primary care setting, saving time, money, and resources.

The Emergency Triage, Treat, and Transport (ET3) model applies to fee-for-service Medicare and will make it possible for ambulance providers to make the decision in favor of urgent care, a physician office, or even on-the-scene telehealth when appropriate. Participating providers can earn up to a 5% payment adjustment, according to HHS. The demo begins in early 2020 with a five-year timeline, but the hope is that ET3 will have a spillover effect with other payers.

If successful, ET3 will help chip away at the challenge of reducing ED use with a common-sense approach. One quality metric to keep an eye on, of course, will be how paramedics triage patients.

In our example, Ann’s sore throat might very well be a common cold that doesn’t warrant emergency care. But if Ann has a food allergy and spent the afternoon eating potluck at the neighborhood brunch, a trip to the hospital might be in order.

We know that rethinking the incentives around care delivery is a key component of a Smart Health Market, and there’s no doubt that lower-cost, alternative care sites will be pivotal in accelerating the transformation.