One month after MinuteClinic struck a heady deal to link EMRs with the Cleveland Clinic and one week before the US government announced a health emergency due to Swine flu, the CVS Caremark subsidiary announced it planned to shutter 16% of its locations during spring and summer, normally the off-season for colds and flu.
Industry experts claimed that poor business performance during these periods represented “a structural flaw” in the retail clinic business model, and predicted a gloomy future for all but those with storefronts in close proximity to, or otherwise affiliated with hospitals and physician groups.
That’s because provider-associated retail clinics have large enough catchment populations to sustain themselves year-round, or at least offset lower off-season traffic with business at other venues and facilities.
MinuteClinic’s decision risks nullifying the very image of convenience that drives success in the first place, according to Tom Charland, CEO of Merchant Medicine, a consultancy specializing in retail clinics.
“You can’t preach convenience and consistency out of one side of your mouth and then have it sort of up in the air as to whether that clinic is open or not,” Charland told AMedNews.
With over 500 stores, MinuteClinic is the largest retail clinic chain in the US. It’s not clear whether other clinic chains will follow suit, or how the Swine flu scare might shuffle the deck.
The retail clinic business is not for the faint of heart.
On average, it takes 3 years before outlets turn a profit, and many fold before then.
CheckUps for example, closed 23 of its Wal-Mart housed clinics in January 2008, and last summer SmartCare shuttered 15 venues which had also been housed in Wal-Mart.
Still, the number of retail clinics continues to rise.
About 1,100 clinics are open today, as compared with only 200 at year end, 2006.
And soon after announcing the seasonal shutdowns, MinuteClinic itself opened several new, year-round locations in Massachusetts.
They’re stocking up on Tamiflu and Relenza as we speak.