Wednesday, October 10, 2012

Vertical not-quite-integration in medical care

The NY Times has a good story about the opportunity created by the closing of the old St Vincent's hospital in Manhattan.  Rushing to fill the void are retail clinics, affiliated with bigger medical centers:

Without building a hospital, one large chain, Continuum Health Partners, is establishing a beachhead in Chelsea and the Village by connecting with outpatient clinics, trying to dominate the market and create a feeder network for its hospitals in other neighborhoods. It is joining forces not just with traditional clinics but also with newer experiments like doctors working out of drugstores. A competitor, NYU Langone Medical Center, is expanding its physician practices downtown, and like Continuum, it has hired dozens of stranded St. Vincent’s doctors.

The integration will reduce costs if it is cheaper to see patients in a clinic than in an emergency room or physician's office.  Regardless, the vertical relationship benefits both the retail clinic and the hospital:

The hospital system checks doctors’ credentials and provides — and bills for — laboratory, radiology and imaging services prescribed by the [retail] doctors. The system also gets a potential trove of patients referred by the clinics. The [retail] clinics earn the cachet of being associated with major hospitals, and as with other affiliated practices, the [retail] patients are given expedited access to Continuum specialists and direct access to hospital admission if needed.


  1. "it is much cheaper to see patients in a clinic than in an emergency room or physician's office"
    Really? So you have data for this? I don't understand the reasoning which results in the marginal costs being different.

  2. Good question. I was paraphrasing the info in the article. I have edited to indicate the uncertainty surrounding your question.

  3. Although this report does not address patient care in clinics per se, it does support the theory that care rendered in a physician's office is less expensive than care rendered in the ER:

  4. If it will cheap and integrated then it will very useful for the patients.