Beyond the Acute Episode: Can Retail Clinics Create Value in Chronic Care?

Although retail clinics have been offering some chronic care services since 2013, they have yet to achieve a notable footprint in this space. Now, new payment models are creating the business case for health systems and retail clinics to partner to add more chronic care services to clinics' limited menu. This can be a positive development, as retail clinics have the potential to improve chronic care by increasing access to care, boosting patient engagement, lowering cost, and improving outcomes. Our view is that, with changing payment models, the time has come for retailers to become a meaningful player in chronic condition management.

Retailers' success at chronic care management calls for strong collaboration with health systems. To date, fee-for-service (FFS) reimbursement has mostly discouraged such collaboration, since under FFS, retail clinics would pose a competitive threat for lost revenue to both physicians and health systems. And retailers, who depend on physicians for pharmacy scripts, have been careful not to be viewed as competitors. However, the landscape is changing. While many health systems and medical groups still make most of their revenue under FFS, the Medicare Access & CHIP Reauthorization Act of 2015 (MACRA) should accelerate the shift to value- based payment models. This shift may encourage partnerships between health systems and retailers around chronic care delivery, as incentives under value-based payment models reward physicians for delivering care more cost-effectively and for having high quality-of-care scores. Under these incentives, retail clinics, with their ease of access, protocol- driven processes, and low cost structure, can be- come attractive partners for health care providers.

Through interviews with industry executives and an extensive literature review, we sought to under- stand what role retail clinics can play in chronic care and how they can meet the needs of the health care system. Although still in their early days, partnerships with retail clinics around chronic care services can offer important benefits to retailers, health systems, patients, and health plans.

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