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Engage Consumers June 03, 2015

Insights: Health Plans' Evolving View of Retail Health

Partner, Health & Life Sciences, Oliver Wyman

Traditionally, visits to retail clinics were almost an entirely out-of-pocket expense. Now, as Forbes reports, retailers like CVS, Walgreens, and Wal-Mart are finding that the majority of their clinics’ visits are covered by insurance. Oliver Wyman’s Howard Lapsley puts this milestone into perspective:

As recently as two years ago, I heard from health plan executives lamenting the growing popularity of retail pharmacy clinics. They voiced concerns that they would lose control over their members’ interactions with the healthcare system and that their physician networks would revolt if bread-and-butter, high-margin services were ceded to the so-called upstarts.

Flash forward to Forbes’ recent report stating payers now cover four out of five retail clinic visits. Health plans are comfortable because they see retailers providing high quality and low cost services beyond treatment for routine maladies like pink eye or minor scrapes and bruises to wellness and primary care services like annual physicals (with more and more clinical services to come).

More importantly, however, plans see how easy and convenient these delivery locations are from the consumers’ point of view. If health plans (and physicians’ practices) have any chance of succeeding in the emerging consumer-centric healthcare world, they need to understand—and integrate into—the changing health delivery ecosystem.

In our view, winners in the new consumer-centric world not only have to solve for consumers’ desire for simplicity and choice but also deliver care conveniently and easily. This requires integrating multiple consumer-centric care delivery touchpoints, whether through online, telemedicine, urgent care centers, retail clinics, payer “stores,” hospital clinics, or Accountable Care Organizations. Payers can refine their benefits structure and network design and move to omni-channel distribution. And they can help consumers change their lens to one of preventative, holistic care with technology investments and Market 2.0 incentives and rewards that are meaningful and habit forming, 24X7, when and where the consumer wants.

If health plans (and physicians’ practices) have any chance of succeeding in the emerging consumer-centric healthcare world, they need to understand—and integrate into—the changing health delivery ecosystem. – Oliver Wyman Partner Howard Lapsley

A “click and bricks” approach combining technology innovation and convenient physical delivery of coordinated care (including preventative) represents the key to consumer satisfaction and retail success. It does take a village. Payers (including integrated delivery systems) can’t own the whole ecosystem—nor should they—but they can be at the center of the web, forming the right partnerships and coordinated care programs that allow the entire network to operate efficiently and effectively, and allowing everyone to share in the economic upside—including primary care physicians. And one size doesn’t fit all—a virtual visit that works for one consumer segment and one clinical condition fails for another. Plans have the data and intelligence to understand these segments and create personalized, convenient experiences for consumers and employees.

Returning home from Memorial Day weekend, “parked” in traffic on the interstate, I noticed a billboard advertising an urgent care center at the next exit, with a large digital display telling me the current wait time (five minutes). Ease and convenience—front and center. If I lived in that area, that’s where I’d go. Now if they could only do something about the traffic….

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