Providing a new and economical care model, nurse practitioners and clinical nurse specialists initiated a new paradigm of care management with the development of retail clinics. Founded in 2000 by a doctor and nurse practitioner, the retail clinic model is based on the independent practice non-profit clinic model, which was expanded and refined in rural health facilities. Utilizing advanced practice nurses (APN), the model presumes that APNs are available to provide affordable, quality care and that the public will accept APNs as primary care providers. The retail clinic model undercuts traditional private practices through its utilization of advanced practice nurses, who can either provide care independently or under protocols, collaboration or practice agreements. Although APN malpractice liability costs are exponentially lower than physicians’, the retail clinic model minimizes malpractice risk further by requiring the nurse to work under protocol with a medical director and with mandated referral after care to a provider or to one’s medical home.

Located in pharmacies, grocery stores and other retail establishments, retail clinics are small, between 200 and 500 square feet. And, with the reliance on protocols embedded in electronic medical record (EMR) technology, the APN uses his/her specific expertise, combined with information included in the protocol. Thus, the APN is able to quickly diagnose the ailment, determine whether the clinic is the best place for care, and, if it is not, immediately refer and transfer records. Alternatively, the EMR technology allows the nurse to determine whether the patient is a regular customer, if pre-existing conditions and chronic illnesses have been previously reported; thus efficiently and economically providing a foundation for prompt diagnosis, and efficient utilization of space (i.e. patient records), and time caring for the patient.

Although clinics have low overhead, start-up costs run from $50 to $250,000 for clinic set-up, retrofit in the retail space and the cost of medical supplies and software creating a two-to-five year turnaround time on clinics’ recouping start up costs. Thus, many clinics have been forced to close when they ran out of cash and/or were unable to shoulder the financial losses.

Despite the high overhead, it is clear that retail clinics are now a staple in the alternatives for cost effective, efficient care. While 2006 was an amazing year of growth for retail clinics, 2007 evidenced an astounding 350% market increase.

The combination of the economic downturn and the large debt associated with startup slowed the growth of retail clinics. In June 2008 — according to research and consulting firm Merchant Medicine, which advises providers and employers on how to work within the retail clinic industry — the number of retail clinics in the U.S. fell by 12 to a total of 969. This was the first net drop the firm had recorded in the two years. The previous 12 months, clinics were opening at a rate of roughly one per day, according to the firm.

Projections that showed there would be 2,500 retail clinics operating by 2010 are coming up short as the industry has seen more clinic closings than openings in recent months. MinuteClinic™, the first and largest retail clinic chain, now owned by CVS, closed 100 of its clinics for the summer, leaving 452. In two years, the number of clinics housed in Wal-Mart dropped from almost 80 to 30. The retail giant recently acknowledged it would not reach the goal it set in 2007: having 400 retail clinics in operation by 2010. Despite high satisfaction among patients who use retail clinics, investors have found the industry is slow to turn a profit.

However, despite the slow economy, the number of healthcare retail clinics has increased about 15% during the past two years, according to a new report released by the Deloitte Center for Health Solutions. And more of these clinics are beginning to ally themselves with established healthcare organizations.

Now moving into the arena of chronic disease management, retail clinics are expanding their reach into areas of practice traditionally provided in formal office settings and consumers are responding positively to the new care models. While retail clinic businesses experimented with the staff structure, they ultimately returned to the APN/NP PCP model.

Nurse practitioners working in this arena face a myriad of issues. While the basic practices support the utilization of nurses in advanced practice, physicians have attempted to impose barriers to independent practice in the retail setting. Additionally, certain existing barriers to practice have limited the ability of nurses to move from employee to owners of retail clinics.

Professional Partnership Laws – The majority of states do not allow nurses in advanced practice to own or set up professional corporations. Thus, the nurse practitioner is treated like a non-physician partner in the development of retail clinic operations; this limits the nurse to minority ownership of the enterprise with a physician partner or working as an employee of the business. This antiquated legal limitation on corporate formation has impeded the ability of nurses to obtain lending, set up or own retail clinic businesses.

Barriers to Practice – Mixed treatment of retail clinics as traditional clinics/service facilities instead of as nonprofit or federal clinics under state law has created a lapse in law which has been used by some physician organizations to create barriers to practice. States like Rhode Island and Massachusetts proposed new rules governing retail clinics, including a limit on how often a patient could go to one.

In Illinois, the state medical society lobbied for the introduction of The Retail Health Care Facility Permit Act would allow doctors to supervise no more than two advance practice nurses. This measure is similar to legislation enacted in Maryland mandating physician supervision. However, the Federal Trade Commission was asked to review the legislation and determined the law anticompetitive. Texas originally mandated even stricter supervision, requiring that a physician be at a clinic 20 percent of the time to review patient charts and offer guidance, only to relax some of those provisions in 2009. Legislation that went into effect on Sept., 2009 which enabled better patient access and more streamlined NP practice in Texas. SB 532, sponsored by Sen. Dan Patrick and Rep. Garnet Coleman, made the following changes to “physician alternative practices”:

• The requirement for a physician to be on site 20% of the time is reduced to 10%.
• An alternative practice site may be up to 75 miles from the primary practice site, an increase from 60 miles.
• The physician-NP supervisory ratio increases from 3:1 to 4:1.
• Chart review may be done electronically from a remote location.
• NPs and PAs can now write prescriptions for controlled substances lasting up to 90 days, an increase from 30 days.
• A waiver process can be used to increase the practice ratio to 6:1, to modify or eliminate the mileage limitation, or to modify other elements of the on-site practice requirements, provided that a means for off-site collaboration and communication is still provided.

Oklahoma adopted legislation to further limit the scope of practice of APNs in retail clinics, to require that retail clinics must be owned and operated by physicians, that physician supervise all retail clinics, that physicians can only supervise two (2) non-physician providers in the retail clinics setting, and that the APN working in a retail clinic setting must refer patients to physicians within 48 hours of care.

Tennessee adopted legislation to study collaborative practice arrangements. The Tennessee Medical Association (TMA) has drafted rules for the state board of medical examiners that would increase oversight of NPs and other medical professionals by physicians. Other states including Florida and Indiana have considered legislation limiting APN retail clinic practice.