Retail clinics latest health trend state targeted for growth despite regulatory, labor roadblocks.

Health clinics have long been a convenient place to get treated for a cold or aching back instead of waiting for long hours in a doctor's office.

Now a growing number of walk-in clinics are popping up in an even more convenient location--the corner store.

They're called retail clinics, and over the past few years hundreds have opened in corners of drug stores, supermarkets and mini-malls across the country.

The idea is to offer busy people and families a place to have simple medical issues diagnosed quickly, said Margaret Laws, director of the Health Financing and Policy Program for California HealthCare Foundation, an Oakland research agency on affordable healthcare.

"This is not a new place to get all your healthcare. This is a place to get a basic routine thing done," said Laws, who helped write the July study "Health Care in the Express Lane: The Emergence of Retail Clinics."

Until recently, however, the trend had mostly missed California, a result of the state's tough regulations, labor issues and a high number of uninsured, Laws said.

The state has just six retail clinics, although that number will likely grow following a series of acquisitions by the drugstore chain CVS Corp., Laws said.

The company earlier this summer purchased industry's leading retail clinic chain--Minnesota-based MinuteClinic--then bought the Sav-On Pharmacy brand from grocery store giant Albertsons Inc.

As a result, stand-alone Sav-On stores will be converted to CVS stores, which Laws said opens the door to more MinuteClinics in Southern California.

MinuteClinic spokesman Brent Burkhardt said the company is looking to add 200 stores by the end of 2006, but would not comment about specific areas.

Erin Pensa, a spokeswoman for CVS, said the company has not ruled out adding more MinuteClinics in newly re-branded locations, including those in the Los Angeles region.

"There is no reason why there couldn't be a MinuteClinic in every state where we have stores," she said.

The success of clinics like MinuteClinic is largely dependent upon its straightforward business model.

The clinics are usually run by a nurse practitioner and supervised off-site by a physician. Services are often limited to simple medical issues, with an exam usually taking fewer than 15 minutes and costing less than $70.

The clinics can keep the costs low because they have no support staff, no overhead, minimal paperwork and don't have to pay a doctor.

The cost-cutting arrangement, however, has made it difficult for clinics to come to California, which has tough nurse supervision rules.

The wrinkle, coupled with myriad other business factors, make California seem too risky for the nascent industry, Laws said.

"They're working some of these things out in markets where the economics are not quite so steep," she said. "They're waiting to get some momentum."

One option is to simply exchange the nurse practitioner for an actual doctor, a technique adopted by QuickHealth, a company with three Northern California locations that is also planning to open a clinic in East Los Angeles before the end of the year.

"We don't use nurse practitioners," said Dave Mandelkern, an executive with the Burlingame, Calif.-based company. "It's a different set of regulations for us."

While doctors cost more to employ than nurses, they also typically work faster, which means turning fewer patients away, Mandelkern said.

"It works for us," he said.

The only other national chain with clinics in California is Longs Drugs, which has Wellness Express branches in three Northern California locations and the company is considering adding more, said spokeswoman Farra Levin.

The quick expansion of the trend, however, has caused a rift in the medical community. Some worry about patient continuity of care and nurse supervision while other doctors see the clinics as a sensible place to receive simple diagnoses, which frees them up to treat more pressing medical concerns, Laws said.

Still, she questions whether the model will catch on.

"The jury is still out on whether there is enough volume for the kind of things these clinics are set up to treat," she said. "But I think something like this will have a place in the healthcare system."

BY CHRIS COATES 

Staff Reporter