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WHAT IT MEANS AND WHY IT'S IMPORTANT — One very quiet bit of news worthy of a bit more attention: MinuteClinic is up to 645 clinics. Clinic revenues were up more than 15% during the quarter, and the company expects MinuteClinic will break even as planned by the end of the year. That's important because the third quarter isn't exactly a big cold-and-flu month, which means that patients are starting to use clinics for more than just sick care. Third quarter is back to school, which suggests the clinics likely were busier doing other things, such as vaccinations and physicals.
(THE NEWS: CVS' Merlo: PBM continues to demonstrate success. For the full story, click here)
CVS already has reached its goal for this year of 100 new clinics for the year. It has told analysts it will deliver at least 100 more in each of the next couple of years, leading up to implementation of the Patient Care Act. DSN believes that as policy-makers begin to understand what they are, what they do and how they help bend the cost curve, retail clinics will play a much larger role in the American healthcare system. This will happen regardless of the direction health reform goes in this country — even if the entire thing is somehow repealed, which despite recent polls, is very unlikely to happen. DSN doesn't see the Supreme Court throwing it out.
But let's just say it did, though. You still can't put the genie back in the bottle. Without some mechanism in place to check the rising cost of healthcare, DSN anticipates the continued growth of consumer-directed care, with more of the onus for managing cost on the patient. As this kind of cost-sharing increases, consumers will vote with their feet and retail clinic visits will continue to increase. And if health reform continues as planned, 33 million people who didn't have insurance suddenly will. That could create even more pressure on Medicaid, forcing CMS and the states to look for cheaper ways to provide care.
That's why DSN thinks the MinuteClinic news deserves more attention.