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City & State: Big Box Healthcare

By Ashley Hupfl, City & State, January 19

One of the next big things in medical care is offering healthcare services inside retail stores such as CVS, Price Chopper and Walmart, which recently opened primary care clinics in stores in Georgia, South Carolina and Texas.

But if Assembly Health Committee Chair Richard Gottfried has his way, New York will preemptively ban or at least regulate such primary care services offered by major retails chains.

“We are seeing more and more so-called ‘retail clinics’ opening in chain pharmacies, even in supermarket chains,” Gottfried told City & State in December. “The issue of commercialized delivery of outpatient care needs to be confronted. Whether it’s urgent care clinics or retail clinics in pharmacies or supermarkets, there’s a real need to protect consumers and protect the ability of ordinary primary practices to stay afloat.”

New York State law already bars publicly-traded or business corporations from owning medical facilities or employing physicians and other professionals. However, some retail chains in New York have found loopholes to get around the law by renting space inside their retail stores.

In such instances the businesses provide extensive marketing, brand and management services, including electronic health record services, but do not legally own the clinic, Gottfried explained. The lawmaker said the he is also concerned the vast resources of major corporations will ultimately put small primary care clinics out of business.

“We rely very heavily on the professionalism of a healthcare practitioner to protect us when we are in their hands,” Gottfried said. “While no group of professionals is entirely immune to being focused on the bottom line, I’d be rather concerned about who is controlling my healthcare if my doctor were an employee of a big corporation as opposed to being answerable to other healthcare professionals.”

Gottfried has not yet introduced any legislation to ban the retail clinics in 2015, but he is planning to reintroduce a bill co-sponsored with Assemblywoman Amy Paulin this session. The bill would define a retail clinic as an “Article 28” healthcare provider and would limit them to providing unscheduled drop-in services.

Regulating the clinics as Article 28 facilities, which include nursing homes and hospitals, would subject them tight restrictions and regulatory oversight by the state. Gottfried said despite his opposition to the corporate ownership of healthcare, he would support this bill as an alternative as banning retail clinics is not expected to gain much support in the state Senate.

State Sen. Kemp Hannon, the chair of the Senate Health Committee, said he could not comment on Gottfried’s proposal without more specific details, but he did say that he supports giving retail clinics greater latitude to offer healthcare services.

“I don’t know if he has any specific reforms in mind or if this is a situation of the liberal Democrats in Manhattan opposing Walmart,” Hannon said. “I think the point ought to be, ‘What do we do to promote primary care in a quality basis and an accessible basis?’ ”

The state Senate’s one-house budget this past session included a provision that would have expanded eligibility to open limited healthcare services in retail settings to hospitals and federally qualified health centers. The Democratic-controlled Assembly did not support the measure.

“In New York, some of the drug stores can [open retail clinics]] now in many ways,” Hannon said. “They just don’t think they have enough latitude to do it well.”

Proponents argue that retail clinics can offer readily accessible, high-quality healthcare for basic ailments at lower costs than in hospitals and physicians’ offices. Walmart’s primary care clinics also boast of having Saturday and Sunday hours in some locations.

“As of April 2014, we had approximately 100 of these clinics in Walmart stores across the U.S. As part of these efforts, we continue to work with health systems in our stores and have a very flexible relationship with medical providers in local communities,” Bill Wertz, a spokesman for Walmart, said in an email. “These services are critical in helping our customers manage their health in an affordable way while at the same time ensuring they are seeing the right health care professionals that can provide the proper care they need.”

Walmart is not actively seeking to open a primary care clinic in New York, but Gottfried sees his push as a preemptive strike.

“There are certainly lobbyists for some of the pharmacy chains who have talked to me about wanting legislation to allow them to do a much broader range of services,” Gottfried said. “It is, to me, virtually inevitable that once this kind of thing starts to crop up in other states, that it will happen to New York unless we do something about it.”