Over the last few years, retail clinic chains have been jockeying for position, trying to figure out if they had a sustainable business model on their hands. More recently, the industry has gone through a bit of a crisis, with 44 outlets closing in Wal-Mart stores despite the chain's grand plans (otherwise undamaged) to open thousands. Other examples included the closure of seven MedBasics Family Health Centers in Texas and Arkansas, and three freestanding Minnesota Minute Clinics closing. Some critics were beginning to predict the decline, or at least a massive scaledown, of the whole industry.
Now, however, comes at least one sign that the retail clinic industry is far from stalled. Walgreens has announced that by August 2009, it expects to meet its goal of having 400 of its Take Care-branded clinics nationally. It has 293 clinics already, so it's going for 107 more clinics over a six-month period. That's a very aggressive plan, given that these clinics can cost $700,000 to $800,000 each to open, and usually aren't profitable for two years or so. Still, it doesn't appear to deter the pharmacy chain.
The question now is whether Walgreens will make money on the clinics even after two years, given that prices are low, labor costs high and insurance reimbursement uncertain. If they're bringing the clinics in to drive store traffic, it seems an expensive way to do it. But if Americans continue to switch from primary care to retail care for small emergencies, things might work out after all.
To learn more about Walgreens' plans:
- read this piece in the Chicago Tribune
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