News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

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News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel
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Point of Care Testing for Infectious Diseases: Navigating CLIA Compliance and Ensuring Quality

Point of Care Testing for Infectious Diseases: Navigating CLIA Compliance and Ensuring Quality

This white paper serves as a practical guide to enhance the understanding of the POCT team regarding critical success factors and essential functions needed to sustain compliance and produce reliable results. It focuses on the tangible aspects of good laboratory practice and regulatory compliance in routine and urgent patient care settings. This resource will be particularly beneficial to nursing and other clinical staff involved in patient testing.

Penn Medicine Study Shows Telemedicine Can Cut Employer Healthcare Costs by 25%

This is good news for clinical laboratories that already perform medical testing for telehealth providers and an opportunity for medical labs that do not, it is an opportunity to do so

Telemedicine visits have become commonplace since the arrival of COVID-19. Before the pandemic, telehealth was primarily used to give remote patients access to quality healthcare providers. But three years later both patients and physicians are becoming increasingly comfortable with virtual office visits, especially among Millennial and Gen Z patients and doctors.

Now, a recent study by the Perelman School of Medicine at the University of Pennsylvania (Penn Medicine) suggests that there could be a significant financial advantage for hospitals that conduct telemedicine. This would be a boon to clinical laboratories that perform medical testing for telemedicine providers.

According to Digital Health News, in July 2017 Penn Medicine launched a 24/7/365 copayment-free telemedicine program for its employees called Penn Medicine OnDemand. To engage with a telemedicine provider, patients must have a smartphone or tablet with a front-facing camera and updated operating system.

Telemedicine Visits Cost Less than In-Office Doctor Appointments

An analysis of the OnDemand program’s data collected from its inception through the end of 2019 found that the telemedicine appointment per-visit cost averaged around $380, whereas the cost of an in-person visit at an emergency department, primary care office, or urgent care clinic averaged around $493.

Typically, Penn Medicine’s employees used the telemedicine program for common, low risk health complaints. Healthcare conditions that many patients might otherwise not seek treatment for if an in-office visit was inconvenient.

“The data we analyzed pre-date the pandemic. It was a time when people were just putting a toe in the water and wondering, ‘Let me see if telemedicine could treat my needs,’” Krisda Chaiyachati MD, an internal medicine physician and Adjunct Assistant Professor at Penn Medicine, told Digital Health News. Chaiyachati lead the research team that conducted the telemedicine study.

“These days, people seem willing to jump in for an appropriate set of conditions,” he added. “The good news is that we made care easier while saving money, and we think the savings could be higher in the future.”

Chaiyachati and his colleagues found that telemedicine can save employers healthcare costs without sacrificing quality of care.

The Penn Medicine researchers published their findings in The American Journal of Managed Care, titled, “Economics of a Health System’s Direct-to-Consumer Telemedicine for Its Employees.”

Krisda Chaiyachati MD

“The conditions most often handled by OnDemand are low acuity—non-urgent or semi-urgent issues like respiratory infections, sinus infections, and allergies—but incredibly common, so any kind of cost reduction can make a huge difference for controlling employee benefit costs,” Krisda Chaiyachati MD (above), a Penn Medicine physician and the study’s lead researcher, told Digital Health News. Clinical laboratories that already perform testing for telemedicine providers may see an increase in test orders once hospitals learn of the costs savings highlighted in the Penn Medicine study. (Photo copyright: Penn Medicine.)

Telemedicine on the Rise

The idea is not new. In late 2018, Planned Parenthood launched the Planned Parenthood Direct mobile app in New York State. The app provides New York patients with access to birth control, emergency contraception, and UTI treatment with no in-person visit required.

The program has since expanded across the country. Users of the app can connect with a physician to go over symptoms/needs, and the be sent a prescription within a business day to the pharmacy of their choice.

The concept is similar to Penn Medicine OnDemand, which gives patients 24/7 year around access to treatment for common and low-acuity medical issues in a convenient, virtual process.  

Telemedicine was on the rise in other parts of the healthcare industry before the pandemic. According to “The State of Telehealth Before and After the COVID-19 Pandemic” published by Julia Shaver, MD, Kaiser Permanente, in the journal Primary Care: Clinics in Office Practice, 76% of US hospital systems had utilized some form of telemedicine by 2018. This rate grew exponentially while the healthcare system had to navigate a world with COVID-19 on the rise.

And, apparently, quality of care does not suffer when moved from in-person to virtual settings. Two studies conducted by The University of Rochester Medical Center (URMC) found telemedicine to be effective and that “common concerns about telemedicine don’t hold up to scrutiny,” according a news release.

In her New England Journal of Medicine (NEJM) paper on the studies, Kathleen Fear, PhD, URMC’s Director of Data Analytics, Health Lab, and her co-authors, wrote: “Three beliefs—that telemedicine will reduce access for the most vulnerable patients; that reimbursement parity will encourage overuse of telemedicine; and that telemedicine is an ineffective way to care for patients—have for years formed the backbone of opposition to the widespread adoption of telemedicine.”

However, URMC’s study found the opposite to be true. The NEJM authors wrote, “there is no support for these three common notions about telemedicine. At URMC, the most vulnerable patients had the highest uptake of telemedicine; not only did they complete a disproportionate share of telemedicine visits, but they also did so with lower no-show and cancellation rates. It is clear that … telemedicine makes medical care more accessible to patients who previously have experienced substantial barriers to care.

“Importantly, this access does not come at the expense of effectiveness. Providers do not order excessive amounts of additional testing to make up for the limitations of virtual visits. Patients do not end up in the ER or the hospital because their needs are not met during a telemedicine visit, and they also do not end up requiring additional in-person follow-up visits to supplement their telemedicine visit,” the NEJM authors concluded.

“Not only did our most vulnerable patients not get left behind—they were among those engaging the most with, and benefiting the most from, telemedicine services. We did not see worse outcomes or increased costs, or patients needing an increased amount of in-person follow up. Nor did we find evidence of overuse. This is good care, and it is equitable care for vulnerable populations,” Fear said in the news release.

“For patients, the message is clear and reassuring: Telemedicine is an effective and efficient way of receiving many kinds of healthcare,” she added.

Opportunities for Clinical Laboratories

Dark Daily has covered the fast growing world of telemedicine in many ebriefs over the years.

In “Two New Definitive Healthcare Surveys Show Use of Inpatient Telehealth is Outpacing Outpatient Telehealth Services,” we covered how medical laboratories could help hospital telehealth physicians in ordering clinical laboratory tests and reviewing test results to ensure selecting the best therapies.

And in “Despite Technical Challenges During COVID-19 Pandemic, Healthcare Networks Plan to Increase Investment in Telehealth Technologies,” we reported on a survey which showed that in 2021 more than 50% of hospitals and health systems planned to increase virtual care services within two years, a development that we predicted could change how patients access clinical laboratory testing services. And it has.

As telemedicine broadens its reach across the healthcare world, clinical laboratories and pathology groups would be wise to seek collaboration with health plans and providers of telemedicine to figure out where sample collection and testing fits into this new virtual healthcare space.

Ashley Croce

Related Information:

Telemedicine Visits Cut Health System Employee Care Costs by Nearly 25%

Planned Parenthood’s Mobile App Brings Birth Control Pills and UTI Treatment to New Yorkers’ Doorsteps

The State of Telehealth Before and After the COVID-19 Pandemic

Myths Busted: New Studies Show Telemedicine is Effective, Doesn’t Reduce Access to Care

Two New Definitive Healthcare Surveys Show Use of Inpatient Telehealth is Outpacing Outpatient Telehealth Services

Despite Technical Challenges During COVID-19 Pandemic, Healthcare Networks Plan to Increase Investment in Telehealth Technologies

FDA Grants CLIA Waiver Allowing First Test for Chlamydia and Gonorrhea to Be Performed at the Point of Care

Federal regulators continue to recognize value of clinical laboratory testing in near-patient settings

To help in the diagnosis and management of two sexually-transmitted diseases, another point-of-care diagnostic test will soon be available for use in physician’s offices, urgent care clinics, and other healthcare settings. The federal Food and Drug Administration (FDA) announced it granted a CLIA waiver for the binx health io CT/NG assay, a molecular platform used to detect sexually transmitted diseases—chlamydia and gonorrhea—at the point of care (POC).

In a press release, the FDA announced it was “granting a waiver under the Clinical Laboratory Improvement Amendments of 1988 (CLIA) for the binx health io CT/NG assay [binx io],” and that “it is allowing the use of the binx health io CT/NG assay at point-of-care settings, such as in physician offices, community-based clinics, urgent care settings, outpatient healthcare facilities, and other patient care settings, operating under a CLIA Certificate of Waiver, Certificate of Compliance, or Certificate of Accreditation.”

This will be welcome news to many medical professionals, as it indicates federal regulators recognize the value of diagnostic testing in near-patient settings.

Allows Non-Laboratorian Processing at Point of Care

In 2019, binx health received FDA 510k clearance to market its binx io rapid point-of-care (POC) platform for women’s health. “The binx io platform is a rapid, qualitative, fully-automated test, designed to be easy to use, and intended for use in POC or clinical laboratory settings … In the company’s recently completed 1,523-person, multi-center clinical study, 96% of patient samples were processed on the binx io by non-laboratorians in a POC setting,” a binx press release noted.

binx-health-io-platform
According to the Boston-based biotech company’s website, the binx io platform (above) combines ultra-rapid, polymerase chain reaction (PCR) amplification with binx health’s proprietary and highly sensitive electrochemical detection technology. The io instrument processes a single-use, CT/NG cartridge that contains all reagents for testing self- or clinician-collected vaginal swabs and male urine samples. No sample preparation is required. Test results are available in less than 30 minutes. (Photo copyright: binx health.)

“With ever-increasing sexually transmitted infection rates, point-of-care and CLIA-waived platforms like the binx io are essential additions to our sexually-transmitted-infection-control toolbox, which will increase accessibility and decrease the burden on traditional healthcare settings,” Barbara Van Der Pol, PhD, Professor of Medicine and Public Health at University of Alabama at Birmingham, said in a binx press release.

According to binx, the Centers for Disease Control and Prevention (CDC) estimates that one in five people in the US has a sexually-transmitted disease (STD), with an estimated 108 million Americans potentially in need of routine STD testing. Additionally, chlamydia and gonorrhea are the two most treated STDs globally.

Study Finds Binx Health POC Assay Comparable to Traditional Clinical Laboratory NAATs

Van Der Pol led a team of researchers who compared the binx io chlamydia/gonorrhea POC assay to three commercially-available nucleic acid amplification tests (NAATs). The binx-funded study, published in JAMA Network Open, analyzed swab samples from 1,523 women (53.6% with symptoms) and urine samples from 922 men (33.4% symptomatic) who presented to 11 clinics in nine cities across the US.

The molecular point-of-care assay proved on par with laboratory-based molecular diagnostics for vaginal swab samples, while male urine samples were associated with “good performance.”

For chlamydia:

  • Sensitivity of the new POC assay was 96.1% (95% CI, 91.2%-98.3%) for women and 92.5% (95% CI, 86.4%-96.0%) for men.
  • Specificity of the new POC assay was 99.1% (95% CI, 98.4%-99.5%) for women and 99.3% (95% CI, 98.4%-99.7%) for men.

For gonorrhea:

  • Sensitivity estimates were 100.0% (95% CI, 92.1%-100.0%) for women and 97.3% (95% CI, 90.7%-99.3%) for men.
  • Specificity estimates were 99.9% (95% CI, 99.5%-100%) for women and 100% (95% CI, 95.5%-100%) for men.

Van Der Pol told Reuters News, “The bottom line is that chlamydia and gonorrhea are still the most frequently reported notifiable diseases in the US, and it costs us in the $5 billion to $6 billion range to manage the consequences of untreated infections. Unfortunately, about 70% of women who are infected don’t have any symptoms, so they don’t know they need to be tested.”

Tim-Stenzel-MD-PhD-FDA
“The ability to diagnose at a point-of-care setting will help with more quickly and appropriately treating sexually-transmitted infections, which is a major milestone in helping patients,” said Tim Stenzel, MD, PhD (above), Director of the Office of In Vitro Diagnostics and Radiological Health at the FDA’s Center for Devices and Radiological Health, in the FDA announcement. “More convenient testing with quicker results can help patients get access to the most appropriate treatment. According to the CDC, one in five Americans are diagnosed with sexually-transmitted infections every year, which is why access to faster diagnostic results and faster, more appropriate treatments will make significant strides in combatting these infections,” he added. As point-of-care testing for specific diseases increases, clinical laboratories that process these tests may see a decrease in specimen processing orders. (Photo copyright: Duke University.)

The CLIA waiver allows binx to distribute the chlamydia/gonorrhea test to 220,000 CLIA-waived locations across the US through the company’s national commercial distribution partnership with McKesson. Obstetrician/gynecologist and primary care offices, urgent care facilities, community health clinics, STD clinics, and retail settings are all potential testing sites.

Binx says its testing platform can improve health outcomes by:

  • Increasing treatment compliance,
  • Limiting onward transmission,
  • Minimizing the risk of untreated conditions, and
  • Ensuring the right treatment is provided.

In the binx health press release, binx CEO Jeffrey Luber, JD, said, “The io instrument’s demonstrated clinical effectiveness, ease of operation, and patient convenience make it a much-needed tool with transformative implications for public health, especially now during the COVID-19 pandemic, where STI [sexually-transmitted infection] prevention services nationwide have been dramatically reduced or cut altogether as resources have been allocated to focus on the COVID response.”

Should Clinical Laboratories Be Concerned about POCT?

It happens often: after consulting with his or her doctor, a patient visits a clinical laboratory and leaves a specimen. The test results arrive at the doctor’s office in a few days, but the patient never returns for treatment. That is why point-of-care tests (POCTs) came to be developed in the first place. With the patient in the clinic, a positive test result means treatment can begin immediately.

As the US healthcare system continues toward more integration of care and reimbursement based on value, rather than fee-for-service, point-of-care testing enables physicians and other healthcare providers to diagnose, test, and prescribe treatment all in one visit.

Thus, it is a positive step for healthcare providers. However, clinical laboratories may view the FDA’s increasing endorsement of waived point-of-care testing as a trend that is unfavorable because it diverts specimens away from central laboratories.

There also are critics within the medical laboratory profession who point out that waived tests—often performed by individuals with little or no training in laboratory medicine—have much greater potential for an inaccurate or unreliable result, when compared to the same assay run in a complex, CLIA-certified clinical laboratory.

Andrea Downing Peck

Related Information:

FDA Allows for First Point-of-Care Chlamydia and Gonorrhea Test to be Used in More Near Patient-Care Settings

Binx Health Receives FDA CLIA Waiver for Chlamydia and Gonorrhea Test, Expanding Critical Access to Single-Visit Diagnoses

Binx Health Receives FDA 510(k) Clearance for Rapid Point of Care Platform for Women’s Health

POC Test for Chlamydia, Gonorrhea as Good as Lab-Based Assays

Evaluation of the Performance of a Point-of-Care Test for Chlamydia and Gonorrhea

Rapid HIV Tests Suitable for Use in Non-Clinical Settings (CLIA Waived)

Cigna Subsidiary Evernorth Acquires MDLIVE as Demand for Telehealth Grows Among Insurers and Healthcare Consumers

COVID-19 pandemic has elevated virtual care into the mainstream, creating opportunities to increase access to care, including clinical laboratory testing, and drive down healthcare costs

As the COVID-19 pandemic fuels demand for virtual healthcare, Cigna is acquiring telehealth provider MDLIVE in a move that may indicate the insurance giant anticipates virtual visits playing a major role in healthcare delivery going forward. And, with each acquisition within the telehealth space, the need for clinical laboratories and pathology groups to have a strategy to respond to this trend increases.

The acquisition of MDLIVE by Cigna’s health services subsidiary Evernorth is expected to be completed in the second quarter of 2021, pending regulatory approval, according to an Evernorth press release.

Evernorth, noted Becker’s Hospital Review, is a division of Cigna that “includes pharmacy benefit manager Express Scripts, specialty pharmacy Accredo, and the rest of Cigna’s health service product lines.” And that Evernorth focuses on, “… benefit management, behavioral and clinical care, pharmacy, and intelligence.”

Tim Wentworth, Evernorth’s CEO, anticipates consumers’ desire for telehealth options will not disappear as SARS-CoV-2 infections decrease and the country returns to a new normal.

“Customers expect more convenient care interactions and COVID-19 has rapidly accelerated this need. We see an immediate opportunity to build a new model of care delivery, one that delivers a connected experience with greater affordability, predictability, and simplicity,” Wentworth said in the press release.

Evernorth CEO Tim Wentworth
“With the opportunity to serve millions more people, and with more personalized ways to deliver care, we will have an even greater impact on our customers, clients, and partners,” Evernorth CEO Tim Wentworth (above) said in a company press release. “Combining MDLIVE’s platform and strong network for virtual providers with our comprehensive care solutions, we will be better positioned to optimize the care journey to improve affordability and accessibility and to deliver superior support to health plans as they advance their own care delivery models for the future.” Clinical laboratories that support telehealth providers will want to devise strategies to address this trend. (Photo copyright: Evernorth.)

The MDLIVE website states the telehealth company’s provider network includes physicians who are board certified in:

  • Internal medicine,
  • Family practice,
  • Emergency medicine, and
  • Pediatrics.

The company also provides counseling and behavioral health services by licensed mental health professionals.

Virtual Care Expanded Rapidly Due to COVID-19 Pandemic

Cigna was an early investor in MDLIVE. According to the company’s investors page, other investors include:

  •  Health Care Service Corporation (HCSC), a Chicago-based mutual legal reserve company and independent licensee of the Blue Cross and Blue Shield Association.
  • Sentara Healthcare, a not-for-profit that operates more than 100 sites of care across Virginia and North Carolina.
  • Sutter Health, a not-for-profit integrated health delivery system headquartered in Sacramento, Calif., that operates 24 acute care hospitals and more than 200 clinics in Northern California.
  • And various venture capital and private equity firms.

Cigna began investing in virtual care years before the COVID-19 pandemic arrived in America. In 2018, members of Cigna’s employee-sponsored health plans were given access to virtual urgent care services. In 2019, the partnership was expanded to include online appointments with psychiatrists and behavior health counselors, while some primary care services were added last year.

Then, according to Cigna’s Virtual Investment Day Excerpt Video, virtual care expanded rapidly during the COVID-19 pandemic, with the use of telehealth jumping 46% in 2020 compared to an 11% increase in 2019.

That trend was highlighted last month in a report published in the American Journal of Preventive Medicine (AJPM), titled, “Who Is (and Is Not) Receiving Telemedicine Care During the COVID-19 Pandemic.” The study’s authors found a twentyfold increase in telehealth visits starting in March 2020 among six million people with employer-based health insurance, while office-based encounters fell by almost 50%.

Telehealth Drives New Model of Virtual Healthcare

In the Cigna video, Cigna President and CEO David Cordani says telehealth will be an important driver behind a new model of healthcare delivery.

“The emergence of virtual care is an important example of this,” he states. “We have seen consistent growth in virtual care over the past decade and it has rapidly accelerated further during the COVID pandemic. At Cigna, we see this trend continuing and accelerating further, moving well beyond urgent care to primary, coordinated chronic and behavioral care.”

Cordani added that the MDLIVE acquisition will not only increase patient access to care, but also help Cigna drive down healthcare costs to “below CPI (Consumer Price Index) and ultimately to zero or less.”

Evernorth, however, does not appear to be signaling that its expanded network of virtual providers will serve as gatekeepers for patients scheduling in-office visits with their providers. The Evernorth press release states MDLIVE’s 24/7 virtual care platform will “complement—not replace—the way customers and patients interact with their existing providers.” The goal, Evernorth says, is to achieve:

  • Earlier identification and diagnosis of critical care needs;
  • Faster and more seamless referrals to high-performing providers, including specialists and behavioral health; and
  • More convenient access to appropriate, affordable sites of service, and pharmaceutical fulfillment.

“From cost to complexity to quality, there is tremendous potential for progress in healthcare,” Evernorth President and Chief Operating Officer Eric Palmer said in the company press release. “As one, Evernorth and MDLIVE can accelerate meaningful change. MDLIVE will be part of the new, differentiated, and future-state care solutions that improve the patient experience, close the patient-provider accessibility gap, and bring providers opportunities to augment the services they currently offer. We’ll also have the opportunity to expand the reach of MDLIVE’s capabilities to Evernorth’s clients, as well as Cigna’s US Medical customers and clients.”

Opportunities for Clinical Laboratories That Can Support Virtual Care

Evernorth’s acquisition of MDLIVE expands Cigna’s health services portfolio of healthcare services and may provide opportunities for clinical laboratories that are prepared to support telehealth providers.

As virtual healthcare networks become a signature part of employee-sponsored health plans, clinical laboratories and pathology groups will need to keep pace with a changing healthcare landscape that puts a premium on remote and virtual visits. Outreach to health plans may be necessary to ensure clinical laboratories are included in an ever-growing virtual network.

—Andrea Downing Peck

Related Information:

As Demand for Virtual Health Care Surges, Evernorth Announces Acquisition of Long-Term Partner, MDLIVE

5 Things to Know about Evernorth, Cigna’s Health Services Unit

Who Is (and Isn’t) Receiving Telemedicine Care During the COVID-19 Pandemic

Cigna’s Virtual Investment Day Excerpt Video

Oak Street Health Opens Three Primary Care Clinics in Walmart Supercenters in Texas with Full Menu of Clinical Services

The clinics are part of a growing trend among large retailers to open full-service healthcare clinics where consumers seek out other goods and services

Major retail chains continue to partner with local health systems and other healthcare companies to expand the range of primary care services delivered in their stores. The latest such collaboration is a partnership between Walmart (NYSE:WMT) and Oak Street Health (NYSE:OSH) at three locations in Texas.

Why is this trend important for clinical laboratories to follow? Because after 15 years, retail chains are moving past the simple walk-in clinic model of using a nurse practitioner to provide limited diagnoses that produce prescriptions at chain store pharmacies and other retail locations. They are now partnering with local health systems to provide full healthcare services that are delivered by physicians. These medical services include many common clinical laboratory tests.

The new OSH clinics, located in Walmart Supercenters, are open and accepting patients via walk-in, same day, and scheduled appointments. The clinics are located in the Dallas-Fort Worth area at:

  • Arlington Walmart, 4801 S Cooper St, Arlington, TX, 76017
  • Benbrook Walmart, 8840 Benbrook Blvd, Benbrook, TX, 76126
  • Carrollton Walmart, 1213 E Trinity Mills Rd, Carrollton, TX, 75006

The clinics offer comprehensive, preventative, and urgent care services to consumers, including:

  • Primary care
  • Optometry
  • X-rays
  • Dental
  • Behavioral counseling
  • Hearing services
  • Nutrition and fitness

As well as clinical laboratory testing, including:

  • A1C
  • Lipid
  • Pregnancy
  • Strep
  • Mono
  • Flu
  • Drug screenings, and more.

 “While all members of the community—from toddlers to seniors—are welcome at these clinics, Oak Street Health’s focus in its growing network of more than 60 primary care centers remains adults on Medicare,” states an OSH press release.

This partnership between Walmart and Oak Street Health means clinical labs in that area will need to follow their patients to be able to collect the specimens and perform the lab tests for patients seen in Walmart Health clinics.

Walmart Health Center Outside Inside
In, “Walmart Opens Second Health Center Offering Clinical Laboratory Tests and Primary Care Services,” Dark Daily reported in May on similar Walmart Health Center openings like that shown above in partnership with WellStar Health System in Georgia. These full-service primary care centers offer many common clinical laboratory tests. “By offering clinical laboratory testing in support of primary care and urgent care, Walmart may be able to lower prices for lab tests in any market that it enters,” said Robert Michel, Editor-in-Chief of Dark Daily and its sister publication The Dark Report. (Photo copyright: Walmart.)

Oak Street Health Brings Value-based Medicine to 11 States

“It is our mission at Oak Street Health to rebuild healthcare as it should be, and that aligns directly with Walmart’s history of providing accessible and equitable healthcare in communities across the country,” said Mike Pykosz, CEO of Oak Street Health, in the press release. “We look forward to becoming a positive addition to the neighborhood in these new markets and providing an unmatched healthcare experience in a convenient location.”

Both companies are planning to extend their relationship beyond these three locations and open additional clinics in other regions.

“We’ve proudly served customers at these three former Walmart Care Clinic locations for the last five years, and we are excited to bring this evolved approach to healthcare to our customers at these locations with Oak Street Health,” said Marcus Osborne, Senior Vice President, Walmart Health, in the press release. “As we grow Walmart Health locations in other markets, we think Oak Street Health’s innovative value-based healthcare model will help us continue to deliver on our live better promise at these locations.”

The majority of Oak Street Health consumers are Medicare Advantage patients, but OSH does accept most major and commonly-accepted insurance plans, Healthcare Dive reported.

Full-Service Healthcare Clinics Drawing Investor Attention

There is evidence that savvy investors believe moving primary care into retail stores and other non-traditional locations can be a big winner. In its third quarter report, Oak Street Health released very strong numbers for their third quarter, which ended September 30. Their total reported revenue for the quarter was $217.9 million, which accounted for a 57% increase over last year’s third quarter earnings, Yahoo Finance reported.

OSH’s capitation revenue totaled $211.8 million, according to the report, which was a 59% increase year over year. Law Insider defines capitation revenues as “all payments from managed care organizations, where payment is made periodically on a per member basis for the partial or total medical care needs of a patient, co-payments, and all HMO incentive bonuses.”

In its third quarter statement, Oak Street Health also reported caring for approximately 59,500 at-risk patients, which represented 66% of its total patients.

“Our strong third quarter results were highlighted by 38% growth in at-risk patients, 57% revenue growth, and the resumption of new center openings, as we opened 13 centers during the quarter amidst continued uncertainty related to the COVID-19 pandemic,” said Pykosz in a statement, Yahoo Finance reported. “Looking ahead, we continue to be excited by the ample opportunity to drive continued de novo expansion across both new and existing markets, as well as the complementary growth opportunities presented by our Walmart collaboration and CMS’ Direct Contracting program.”

As we wrote in the May Dark Daily e-briefing, “Clinical laboratory leaders may want to explore partnerships with Walmart and other retailers that are developing healthcare centers to deliver primary care services in places where masses of people shop for everyday items. Especially given that these big-box retailers remain open during healthcare crises like the COVID-19 pandemic.”

This is even more critical now, as more retailers partner with health systems to provide expanded primary care and clinical laboratory services.

—JP Schlingman

Related Information:

Walmart, Newly Public Oak Street Health Launch Clinic Partnership in Texas

Oak Street Health Opens Its First Texas Walmart Clinic

Oak Street Health Announces Collaboration with Walmart to bring Affordable, High-quality Healthcare to Texas

Oak Street Health Announces Collaboration with Walmart to Bring Affordable, High-Quality Healthcare to Texas

Oak Street Health Reaches Milestone 70th Location with Entry into New York and Opening of First Walmart Community Clinic

Oak Street Health Opens First Center in Mississippi

Oak Street Health Reports Third Quarter 2020 Financial Results

Walmart Opens Second Health Center Offering Clinical Laboratory Tests and Primary Care Services

Walmart Remodeling In-Store Pharmacies to Include Private Consultation Rooms

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