HMO giant Kaiser Permanente entered the growing retail clinic business for the first time by joining forces with Target Corp. on four in-store locations in Southern California.
Three Kaiser clinics inside Target stores opened Monday in Fontana, San Diego and Vista. A fourth clinic in Fullerton is scheduled to open next month.
These types of in-store clinics are expanding nationwide, driven by a shortage of primary care doctors and an influx of newly insured patients under the federal health law.
Kaiser is California's largest health maintenance organization with 7.3 million members and runs its own network of hospitals and physician practices. Industry analysts said the Target clinics immediately benefit from Kaiser's well-known brand and could gain access to thousands of Kaiser patients.
The deal announced Monday also opens the door to Kaiser treating people covered by rival health plans — another first.
"Kaiser normally isn't in the business of seeing other plans' patients," said Thomas Charland, chief executive of Merchant Medicine, a healthcare research firm. "But opening a retail clinic inside a Target store is a perfect demographic for Kaiser. That could make them even more attractive as a health plan."
Blue Shield of California confirmed it will contract with the new Kaiser-run clinics, but the agreement hasn't been completed yet.
Anthem Blue Cross, a unit of industry giant WellPoint Inc., said it has no plans to sign contracts with the clinics at this time. "We will monitor how the program performs and may reevaluate," an Anthem spokesman said.
Kaiser and Target said they are seeking contracts with other health plans. Medicare and Medi-Cal, the state's low-income health plan, will be accepted in addition to patients paying cash.
There were 1,805 in-store clinics nationwide in November, Charland said. That's up nearly 200 clinics since January. Pharmacy chains such as CVS Health and other retailers have pursued this business aggressively.
These in-store clinics offer convenience near the check-out aisle and tap into the frustration many consumers experience trying to book medical appointments or get treated on weekends or evening hours. The clinics tend to focus on physicals, ear infections and other routine ailments.
Kaiser and Target said their clinics will offer a broad range of services, including pediatric checkups and well-woman exams, as well as helping people manage their chronic conditions, such as diabetes and high blood pressure.
Kaiser said it will staff the new clinics with licensed nurse practitioners and vocational nurses. Physicians will be available remotely for consultations.
"This is the evolution of expanding Kaiser Permanente's high-quality and holistic care delivery into a setting that will provide patients with wellness support," said Dr. Paul Minardi, Kaiser's medical director for these Target Clinics.
Target already runs 79 of its own in-store clinics in seven states. The retailer said it didn't have any immediate expansion plans with Kaiser.
Studies have shown that in-store clinics provide care at costs that are 30% to 40% less than similar care provided at a physician's office and that the care for routine illnesses was of similar quality.
Some family physicians have criticized retail clinics for trying to expand into care for the chronically ill. They said those more complicated cases would be better handled in the doctor's office.