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Which on-demand access point is right for you? 4 questions to guide your next outpatient investment.

June 18, 2019

    With hospital volumes continuing to decline, more health systems are evaluating opportunities for outpatient sites of care. And as competition heats up in the outpatient space, it's more important than ever to appeal to consumers by offering what they value most: convenience and access. 


    But many sites can provide convenient, on-demand services. Among these, extended primary care, urgent care centers, and freestanding EDs are three of the most popular models for convenient care. So how can you decide which on-demand access point is right for you? Here are the four questions we ask when evaluating opportunity across immediate care sites:

    1. Which site will help you achieve your goals?

    First, you have to establish your primary strategic goal, as some on-demand models are more effective than others when targeting certain aims.

    For instance, extended primary care, which can involve extended hours or telehealth, is ideal for increasing access, market share, and downstream referrals. While urgent care centers also expand access and share, their stable, mid-level reimbursement rates are better positioned to secure revenue. In contrast, freestanding EDs are an attractive option if you're looking to drive per-case revenue or generate inpatient admissions for existing acute care facilities.

    2. Which site does your market need?

    To evaluate market need, we recommend looking at both the demand and supply side of the equation, estimating unmet need for each site of care. To estimate unmet need, answer these key demand and supply questions:[1]

      Demand Questions Supply Questions Advisory Board Resources

    Extended Primary Care

    •Is there an undersupply of PCPs?

    •Do market primary care practices offer extended hours or virtual visits?

    Estimating local need for primary care providers

    Urgent Care Center

    •Is there an undersupply of PCPs?
    •What is the demand for primary care-suitable ED visits (27% of non-admitted visits)?

    •How many urgent care centers are in your service area?
    •How many full-service retail clinics are in the market?

    Estimating local need for primary care providers
    Emergency Department Market Estimator
    Demographic Profiler

    Freestanding Emergency Department

    •What is the demand for non-admitted ED visits?

    •How many freestanding EDs and hospital-based EDs are in your service area?

    Emergency Department Market Estimator

    3. Which site will your patients use?

    On-demand sites differ in their ability to meet access and convenience preferences. Using our On-Demand Primary Care Preferences Explorer, you can see which preferences are most important to consumers in your state and then evaluate the ability of different sites to meet those attributes. For some of the most commonly preferred attributes, we see:

    4. Which site is the most feasible investment?

    Finally, consider the financial opportunity-cost associated with these on-demand ambulatory sites.

    While extended primary care is the lowest cost investment, it has the lowest per-case revenue. Urgent care investments have stable, slightly higher reimbursement rates, but they often require facility and technology investments in addition to added staffing. Lastly, freestanding EDs require the greatest upfront facility and technology investments but offer the greatest potential revenue and the most favorable payer mix.

    Our Investment Decision Benchmark Database can help you explore these considerations in greater detail.

    [1] Advisory Board resource links:


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