Franchise Jumps On Growing Demand For Urgent Care Centers

Wednesday, March 02, 2011

One of the latest concepts in delivering health care has come to San Diego County.

Doctors Express, the only for-profit national urgent care franchise in the country, has opened two offices in San Diego County since November. The company offers franchisees a formula for getting into a growing sector of health care while giving consumers an option when they're sick or injured but don't need a hospital emergency room.

San Diego already has a number of urgent care centers open into the evening and on weekends for walk-in patients with broken bones, sprains, lacerations, respiratory infections, back pain, dehydration or other non life-threatening ailments. Most centers in San Diego are run by large medical groups, although a few have individual operators.

Peter Ross, chief executive of Doctors Express, said he saw an opening for a national franchise when he founded his Maryland-based company in 2006. Study after national study showed wait times in hospital emergency departments exceeded four hours.

"We saw a huge need because of the emergency room wait times," he said. "And the cost factor is a huge advantage." In San Diego County, the average emergency room charge for a low to moderately severe medical problem is about $500, plus fees for tests and other services, according to state records. The total cost for a typical visit to a Doctors Express is less than $200, said Kari Knowles, who opened her Doctors Express office in Oceanside this week.

When Knowles decided to go into the business, she was less concerned about being a franchise trailblazer and more focused on starting a company that allowed her to remain in health care, she said. Knowles and her husband, Jeff, have worked as chiropractors for 20 years in Carlsbad. He retired a year ago and she began looking around for a less strenuous line of work.

"We started looking at franchises," she said. "We didn't want to reinvent the wheel, and this was very similar to what we had been doing." The Doctors Express formula requires partnerships between a business manager and a physician, who serves as medical director typically overseeing several other doctors and medical assistants. Knowles partnered with Dr. Alireza Etemadi, a family practitioner who has worked in emergency rooms.

In Santee, Paul Arvanitis and partner Dr. Luzviminda Saidro opened their Doctors Express in November. Like Knowles, Arvanitis also has a background in the health field, previously working as an executive in Omega Group Industries doing preconstruction planning for hospitals and medical centers.

"It's been very exciting," Arvanitis said. "The first month we had a couple of hundred visits. This last month, we've seen 500 patients so it's definitely been growing." Doctors Express, which Ross said has 34 franchises in 18 states with an additional 40 centers due to open this year, is following the latest upswing in an industry that began in the 1970s with entrepreneurial physicians looking for a new way to make a living.

By the late 1980s, hospitals began buying up some of the first centers and then ended up closing them as too expensive to run under traditional hospital-style management, according to a study by the nonprofit California Healthcare Foundation.

A new growth spurt began in the late 1990s and has continued steadily since then. Today, about 9,000 urgent care centers operate around the country, said Lou Ellen Horwitz, executive director of the Urgent Care Association of America. "The number has been growing steadily, with about 300 new centers a year for the last three or four years. A lot of them are started by emergency room physicians" looking for a less stressful and more predictable schedule, she said.

Horwitz said patients generally know when to go to the emergency room instead of an urgent care center.

"The vast majority of people who choose urgent care do it appropriately," she said. "If it's something that can wait, you can go to urgent care. Anything that's life- or limb-threatening, go the emergency room." The increasing demand for convenient, affordable walk-in clinics also has sparked a parallel growth trend in in-store health centers. As the number of physician-staffed urgent care centers have increased, so have services such as Minute Clinics at CVS pharmacies and PPH expresscare clinics in Albertsons/Savon stores, which are staffed by nurse practitioners and physicians assistants. Those mini clinics offer some but not all services provided by urgent care centers.

Palomar Pomerado Health was the first public hospital district in California to open such retail clinics when it launched its two expresscare outlets in Escondido and Rancho Penasquitos in 2008.

Similarly, some community health clinics have expanded walk-in services. South Bay Family Health Center opened a six-day-a-week urgent care center in 2009.

A key element in marketing urgent care centers is that they aren't just a cheaper and faster alternative to the emergency room, but that they're open when the family doctor is booked or has gone home.

The centers also market themselves as a one-stop shop with in-house labs, X-ray equipment and other diagnostics that allow them to provide midlevel medical care unavailable in the typical doctor's office.

Without a regular patient base, the centers often also contract with companies to do occupational medicine pre-employment physicals and drug testing, job-related injury assessment and other services. Ross said Doctors Express franchises try to make that 25 percent of their patient volume.

Typically, urgent care centers take Medicare, Tricare military insurance and most major health plans and give discounts for cash customers. In San Diego County, most centers don't take Medi-Cal.

Urgent care centers fill a niche that could relieve overburdened emergency departments, said Dr. Franz Ritucci, president of the American Academy of Urgent Care Medicine.

"Urgent care centers can offer a rainbow of services that a family practice can't do," Ritucci said. "And emergency departments were not designed to provide urgent care. They really were designed for patients with life-threatening conditions gunshot wounds, car accident injuries, strokes." Many local hospitals have opened attached "fast-track" units to relieve emergency departments' overcrowding. The ER redirects patients with minor injuries or ailments to the units.

The UCSD Health system has opened what it calls urgent care centers within the emergency departments at UCSD Medical Center in Hillcrest and Thornton Hospital in La Jolla. Spokeswoman Jacqueline Carr said the system is superior to independent centers.

"The real advantage of going to a hospital-based urgent care is that if something like indigestion turns out to be a myocardial infarction, the patient can immediately be treated by cardiologists and surgeons if need be," she said. "There is no need to call an ambulance or to do repeat studies. For cases that turn out to be complex, every minute can be lifesaving. When the specialists are in walking distance of urgent care, you're better off." In contrast, Sharp Rees-Stealy Medical Group operates five urgent care centers around the county. The group is affiliated with the Sharp HealthCare system and its hospitals.

Opening the urgent care centers "initially was a way to streamline our patients' visits," said director David Byron. "As it grew, we were noticing that to meet the needs of the community we needed to expand to have contracts with other insurers." The majority of the 120,000 patients a year who go to the Sharp Rees-Stealy centers are in the Sharp HealthCare health plan, although about a third have other insurance. Fewer than 10 percent pay cash, Byron said. Uncomplicated "lower level" visits cost about $150 and wait times are about 35 minutes, although they've been about 15 minutes longer during this winter flu season, he said.

Because of its affiliation, the 60 doctors employed at the urgent care centers can admit a patient directly into a Sharp hospital without going through emergency room first.

Byron said he wasn't worried about more urgent care centers opening in the county.

"The emergency rooms are so overwhelmed that there's a little bit of a niche for everybody," he said.

Urgent Care & More on Midway Drive in Point Loma is one of the few urgent care centers in the county that's individually owned. Manager Holly Bartram, an X-ray technician, said owner Dr. Mark Tamsen opened that center in 1999 after Sharp Cabrillo Hospital in Point Loma closed its emergency department.

"He was an emergency room physician on staff there," Bartram said. "When it closed, he opened this to keep emergency services in the community." Bartram said about 1,200 patients are treated a month with about one quarter paying cash.

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