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Hospitals and health systems should develop strong relationships with urgent and retail clinics

Health data needs to be interoperable for the relationship between health systems and clinics to bridge the consumerism gap.

Jeff Lagasse, Associate Editor

When it comes to retail clinics and urgent care clinics, hospitals have two options: Own them or partner with them. Either way, such clinics represent an ever-bigger share of the market, and it behooves hospitals and health systems to develop a relationship with them.

The reason is rooted in consumerism. Patients are used to the conveniences of other industries such as retail, and increasingly they expect the healthcare industry to follow suit with the options and amenities they've come to expect.

In order for that positive relationship between health systems and clinics to thrive, health data needs to be interoperable, as the two entities coordinate on providing strong patient care.


"I think we live in an on-demand society," said Eric McDonald, CEO of electronic health record and practice management company DocuTAP. "If you look at just the consumerization that's happening, how do you do most of your stuff? One-click Amazon services. People want and expect the same things out of healthcare."

A decade ago, he said, a theme began to emerge: How to create a really strong patient experience. How to set the bar high. That focus has been consistent throughout the years. What has changed is that people no longer have the same relationships with their primary care doctors. Consumer technology can keep them engaged, but with more patients opting for retail and urgent care clinics for their immediate healthcare needs, hospitals need a foot in that space.

The debate has been whether they need to own the clinics outright or enter into a management agreement. Ultimately, hospitals need referrals from the clinics to make it upstream into their systems in order to maintain a financially symbiotic relationship.

"In theory, your hospitals and health systems have felt like they need to own them," said McDonald. "And they go in and spend a bunch of cash, but then divest them. So they say, 'Maybe we should just have a relationship with these guys.' It's a hamster wheel that repeats itself every three or four years."

As far as the interoperability picture is concerned, it's nowhere near where McDonald thinks it should be.

"I would hope to have a lot better integration," he said. "Part of it is the complex nature of what you're dealing with. There's a lot of non-standard data. Once you say everything has to be standardized … it just doesn't fit."


That's where DocuTAP comes in, as a means of allowing disparate EHR systems to talk to each other. Similar market offerings include athenahealth, PrognoCIS and AdvancedMD, which essentially engender compatibility between systems.

Interoperability is key not just for the hospital/clinic relationship, but to ensure that physicians don't succumb to burnout and are able to consistently provide the best care possible.


One complicating factor is that urgent care and retail clinics run by hospitals or health systems often aren't profitable. But McDonald doesn't think that needs to be the case.

"There's no reason why an urgent care can't stay profitable," he said. "They historically haven't been in the hospital world because they run it more like an ER than than they do an urgent care. In my mind, the more efficient they run it, the better it is for healthcare. There's no reason why an urgent care should be losing money. I think it's good when a key component of healthcare can have some level of profitability."

Hospitals might be more comfortable operating such entities through a management group or joint venture. Such arrangements tend to be more successful from a financial standpoint.

"In a typical joint venture, there's a shared management structure," said McDonald. "In a management agreement, the hospital owns it but hires an external group to manage it. Equity can come in a number of different ways. They're looking for the brand and downstream referrals, so they can have a small part of the equity but are getting the brand recognition."

The best option depends on the individual needs of the health system, he said.


Rural hospitals in particular have much to gain from utilizing retail and telemedicine strategies. Healthcare delivery is evolving away from inpatient care in favor of more outpatient care, and if rural hospitals don't adapt, then certain markets will simply let them disappear altogether.

Twitter: @JELagasse
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