The State of the Urgent Care Industry

Urgent care centers play a critical role in bridging gaps in healthcare access. The benefits of urgent care centers are many—but so are the challenges. Whether you’re seeking to optimize an existing center or launch a new one, you can use valuable guidance to enhance care delivery and operational success.

To learn more about the dynamic landscape of urgent care centers, we spoke with Alan Ayers, president of Urgent Care Consultants in Sunbury, Ohio.

Q: What do urgent care centers provide, and how do they differ from retail clinics?

A: It’s almost easier to define urgent care by what it’s not. The centers are not emergency rooms; they do not treat anything that’s threatening to life or limb. They don’t deal with trauma or life-saving resuscitation. They’re also not primary care facilities. They don’t provide annual wellness physicals, age-appropriate exams, colonoscopies, mammograms or management of chronic disease.

Urgent care centers provide same-day, on-demand access to basic healthcare, covering routine health issues such as flu, cough, COVID, sore throats, sinus pain, sprains, strains, cuts and rashes. They emphasize local access, and part of that access is extended evening and weekend hours.

Urgent care may be staffed by a nurse practitioner like a retail clinic. However, nurse practitioners in the urgent care setting are supported by x-ray and lab and the ability to perform procedures. Although there may be some overlap of care provided, retail clinics cover very low-acuity routine health issues such as cold, pink eye and athlete’s foot. They’re limited in their scope, and a lot of patients have learned to just go straight to urgent care.

Research shows it can take an average of 26 days to get to see a family doctor in the US¹

Q: What are the benefits of urgent care centers?

A: It’s been a consumer-driven or patient-driven phenomenon. Patients love the convenience of having somewhere nearby they can go and be seen on the same day when their primary care physicians are not available. And early intervention can reduce costs later. Let’s say you have a cough. It may resolve on its own or it may turn into pneumonia, resulting in a very expensive hospitalization.

Urgent care centers allow primary care physicians to focus on wellness and chronic conditions. Primary care is becoming more and more complex, especially with the addition of behavioral health. Same with the emergency room, which should be used for trauma and resuscitation.

On a societal level, with the expansion and privatization of Medicaid, urgent care centers provide access to populations who, historically, have found access to care challenging. The fastest growing segment of urgent care right now is going into rural and secondary markets where there’s a shortage of primary care, and rural hospitals are closing. People in these areas might have to drive 45 minutes to an hour for basic healthcare.

Over time, we’re seeing those urgent care centers converge with primary care. As new payment models like value-based care come out, urgent care is continuing to reinvent itself. There are segments of the population who are not tied into primary care, particularly the younger, generally healthy generation of people in their early 20s. They’re used to going to urgent care for all their needs. They’re not getting annual tests and exams for wellness, so urgent care is in a position to serve their primary care needs.

As of September 2024, there are a total of 14,245 urgent care centers in the United States:

• 96% treat all ages, whereas 4% specialize exclusively on pediatric populations
• 39% are affiliated with a hospital or health system, while 61% are unaffiliated
• 18% are single unit operations, while 82% are part of multi-unit footprints
• 17% have received investment from private equity portfolios, whereas 83% have not²

Q: You’ve noted that revenue growth is a top concern of urgent care operators. What’s holding them back?

A: No matter what business you’re in, revenue is equal to volume times rate. Urgent care rates are set by insurance companies, which means your lever for urgent care is volume. And urgent care is a seasonal business, so it’s heavily dependent on the severity of respiratory virus season—flu, COVID, RSV. Peak seasonality generally starts in November and can go as late as April. During the off season, there’s excess capacity in urgent care. That’s a challenge because they need to have the same staff and providers. There’s simply not as much volume since the pandemic ended. Meanwhile wage inflation rates are up, and insurance reimbursement has not adjusted. Reimbursement is a top challenge.

In terms of looking to diversify revenue, I encourage clients not to chase trends such as weight loss and cosmetic injections. There is a finite portion of the population that seeks those services. And there’s a lot of competition among medical spas and dermatology. Even primary care does a lot of these things.

Q: What other major challenges are urgent care centers facing?

A: Staffing is an issue, especially front desk support staff and medical assistants. The nation produces about 30,000 nurse practitioners a year, so getting providers is not as great of an issue. However, urgent care has become somewhat of a training ground; this setting is where many new nurse practitioners gain experience toward independent practice. So we’re seeing a decline in the acuity of what urgent care centers treat.

There are also some regulatory issues, such as x-ray laws. Some states allow medical assistants to perform x-rays with on the job training. Other states require somebody with an advanced certification, such as a radiology technologist. That means urgent care centers are competing against imaging centers and hospitals. And radiology technologists cost more.

More than 1 in 4 adults don’t have a primary care physician²

Q: What strategies can urgent care operators use to overcome these challenges?

A: Point-of-care testing is huge, and urgent care is the prime market for this service. About half of the urgent care centers in the country do not offer any sexually transmitted infection testing, and the Centers for Disease Control and Prevention says that STIs are through the roof. If an STI can be diagnosed through a urine sample, those are easy tests for urgent care to do. It’s also a way to address the revenue issue. And I think we’re going to see new technologies that are going to increase the number of tests, the range of tests and the type of tests that can be done in urgent care. And done cheaper, faster, more efficiently and more accurately.

Q: What’s your view on telemedicine and artificial intelligence?

A: Some urgent care centers have extended their business into telemedicine, which works if you have the excess capacity. However, I would say telemedicine has been probably more of a threat to urgent care. A lot of hospital primary care groups added nurse practitioners to solely serve their telemedicine.

AI can mean about a dozen different things. Right now, it mostly refers to ambient scribe, a technology that uses AI and natural language processing to capture and transcribe patient interactions in real time. It fills in the chart in the electronic medical record. This results in more accurate documentation and billing—potentially leading to higher reimbursement. Sometimes money gets left on the table because urgent care centers don’t document well, which can indicate a lower level of service. They don’t capture all the ancillary codes, so they’re not getting paid for all the services they provided.

But more importantly, the provider isn’t spending all their time charting, which is the number one thing clinicians complain about. And it can increase their capacity and make them more efficient. I think AI is going to become a standard feature that will be integrated into processes.

Q: What about opening employer-site clinics or school-based clinics?

A: Those are emerging fields urgent care operators can take advantage of due to operational similarities. There’s a whole movement of employers offering on-site clinics and school clinics going onsite. An employer-site clinic is effective if an organization has enough employees working in one location to make it financially feasible.

Another approach is a shared-site clinic. For example, a clinic could serve a whole school district as opposed to one school. Or the employees of multiple companies have a nearby clinic they can go to for health issues.

Q: What kind of specialties should urgent care centers consider adding?

A: Some large rural operators have added specialists who are relevant to the common presentations at their urgent care centers. Suburban urgent care centers should consider adding orthopedics, which is one of the biggest specialties. Also look at dermatology, podiatry and gastroenterology. Urgent care can refer patients to area hospitals, which the hospitals appreciate.

Q: Are joint ventures advantageous?

A: A joint venture is the best of both worlds for urgent care centers. From the standpoint of access, the arrangement puts the hospital’s brand into the community. It also helps them capture referrals and build loyalty. And the hospital’s primary care physicians can refer patients to their own urgent care clinics in the hospital ecosystem. The best scenario is for a hospital to find a private urgent care operator who will create a joint venture and either co-brand it or brand it as the hospital’s urgent care. Then you get the operational efficiency.

Q: How can vendor management be improved to optimize the urgent care supply chain?

A: Urgent care centers need to evaluate vendor pricing and review their product mix. Every couple of years, you should look at your pricing relative to other options. But price isn’t the only thing. Relationships are critical as well. Vendors can help urgent care operators better manage their business. They can advise on POC testing, helping clinics understand new products and their ROI. For example, a product may cost more, but you may get higher reimbursement. You may have better patient outcomes or see patients more efficiently.

If you’re opening a new center, work with your vendors to optimize your package. Make sure that you’re buying what’s needed for urgent care, not what’s excessive. For instance, you could get a $700 treatment table, or you could get a $5,000 movable treatment table. You don’t need one of those in every single room. Maybe one room where you’re doing certain exams or procedures. The vendor adds value when they understand the urgent care business and can help urgent care leaders make the best decisions about products. And if you can share data with your vendors, they can ensure you have what you need when you need it.

89.4% of the US population is within a 20-minute drive of an urgent care center³

Q: What should urgent care operators do to better educate patients to ensure they understand visit summaries and necessary follow-up actions?

A: You need to provide clear discharge instructions that are produced by the EMR. And walk through the instructions with the patient. Schedule a follow-up appointment if indicated. If you’re making a referral, try to schedule the appointment with the referral. And good customer service practice is calling the patient after two to three days to check on them. People appreciate that, and you can identify patients that may need to come back in.

Q: You’ve mentioned in your writing that the number of people without a primary care physician is increasing with each new generation. How can an urgent care center create patient loyalty?

A: The main elements that draw loyalty tend to be like the retail service industry. The number one complaint is wait time, and the number two complaint is rudeness. Get the patients in and out quickly and treat them well. Once people experience that, your center should become their go-to place.

Q: How should urgent care centers promote themselves?

A: If you’re thinking about using social media, remember that it’s a double-edged sword. Be careful what you claim; people can comment on what you post. It’s best to find groups with moms and kids: school, preschool, church, PTA. Find the opinion leaders in those groups. Tie your center into group activities. At venues where moms are present, have a mascot take pictures and post those photos. That’s a great way to raise awareness.

You also can use data to stand out. We’ve seen urgent care operators educate the public on an ongoing basis, for example, announcing that strep rates are up in the community and what symptoms to be on the lookout for. People start to better understand the benefits of urgent care centers.

Google can be a valuable tool. If you go in Google Maps and type “urgent care near me,” Google’s algorithms will decide what’s listed first. There are three factors that drive search domain authority. First is proximity and second is ability to schedule an appointment online. Number 3 is the number, the quantity and quality of online reviews. So if you have five-star reviews, you will be ranked higher than if you have four-star reviews. That all goes back to offering good service, getting people in and out quickly and being nice to the patients.

Alan Ayers is president of Urgent Care Consultants in Sunbury, Ohio. He is senior editor of the Journal of Urgent Care Medicine and a past member of the board of directors of the Urgent Care Association.