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Clinics may not lower health insurance costs

Walk into these clinics, and the American health system might be spending more than it had hoped.

The massive growth in the number of retail health clinics may be leading to more overall spending on medical services nationally — despite a belief that those lower-priced facilities would actually cut total health spending, according to new analysis published Monday in the journal Health Affairs.

A key finding in the study is that the clinics have led to increased overall use of medical services, which outweighs the savings that were realized by patients who previously would have gotten care from more expensive providers.

The findings raise the question of whether other convenient, lower-priced options for providing health services, such as "telehealth" and "e-visit" medical consultations, or kiosks offering testing in stores, could also end up leading to overall increases in health spending, despite being touted as cost-savers.

"This convenience could increase spending," said Dr. Ateev Mehrotra of Harvard Medical School, one of the authors of the study, and an adjunct researcher at the Rand Corp.

Walgreens health-care clinic
Scott Olson | Getty Images
Walgreens health-care clinic

The study comes as the number of retail clinics — found in pharmacies, grocery stores and mega-retailers such as Walmart and Target — has reached nearly 2,000 since they first appeared a decade ago.

More than 6 million people now visit the clinics annually, attracted by both their convenience and lower prices than what doctors' offices and emergency rooms would charge.

The study looked at visits for 11 different types of "low-acuity" conditions, including urinary tract infections, sinusitis, flu, upper respiratory infections, bronchitis and unspecified viral infection. Such conditions account for more than 60 percent of all visits to retail clinics.

Researchers found that most of the visits — about three-fifths — to the retail clinics for those conditions were classified as "new utilization," meaning people wouldn't have gotten treatment if the clinics didn't exist.

Just two-fifths of the retail clinic visits were by people who were substituting treatment by the clinic for what would have been more pricier visits to their doctor's office or hospital emergency rooms.

Researchers looked at the change in the numbers of people using retail clinics and compared to the numbers of people using doctors' offices, emergency rooms and other traditional providers to determine what use in the clinics was new, compared to patients who would have otherwise gotten treatment elsewhere.

"In total, the increased spending from new utilization outweighed the savings from substitution," researchers wrote in Health Affairs.

And "instead of decreasing spending overall, we found that the use of a retail clinic was associated with 21 percent higher spending for low-acuity [low-level] conditions," the authors wrote.

The average amount per person in increased spending in actual dollar terms was relatively small — just $14.

But the fact that there was a spending increase at all flew in the face of a longstanding belief, and hope, that retail health clinics could be tool in reining in total U.S. health spending by cutting costs per user.

"These findings suggest that retail clinics do not trim medical spending, but instead may drive it up modestly because they encourage people to use more medical services," said Mehrotra.

He said the results should give insurers pause.

The study noted that "the majority of care at retail clinics is paid for by health plans." Many of those insurers have created incentives for members of their plans to use retail clinics, as opposed to going to the doctor, such as by waiving copayments for visits.

"Health plans may want to consider our findings as they decide whether and how to cover care at retail clinics," Mehrotra said.

"If the goal is to lower costs, then encouraging use of retail clinics may not be a successful strategy."