UnitedHealth's Optum unit makes big push into urgent care in Minnesota

UnitedHealth Group's Optum division is making its largest push thus far into patient care in Minnesota with up to 19 new urgent care centers planned by the end of 2017.

Operating under the brand name MedExpress, two of the urgent care centers are scheduled to open Friday in Eden Prairie and Plymouth.

Final tallies and precise locations for the other clinics could change over the next 15 months, company officials said. But the current plan calls for 12 urgent care centers in the Twin Cities and another seven beyond the metro.

The MedExpress growth plan looks like a substantial expansion for the state's overall supply.

Survey data from MN Community Measurement, a Minneapolis-based nonprofit group, indicates that 89 clinics in Minnesota this year are offering urgent care, which ranges from walk-in care to advanced services like minor surgery and treatment for broken bones.

"This is unusual," said Tom Charland, a consultant who tracks the industry at Shoreview-based Merchant Medicine. "The other operators are growing, but not at this pace."

Optum is the health services division of Minnetonka-based UnitedHealth Group. The company also operates UnitedHealthcare, which is the nation's largest health insurer.

Optum acquired MedExpress in spring 2015, but didn't disclose the purchase price. The company now stands as the nation's largest provider of urgent care services, Charland said.

Urgent care is perhaps the most visible example of how Optum has made a growing business out of employing doctors and other caregivers. Currently, the company's OptumCare unit includes more than 18,000 physicians who either are employed or work with Optum on a contractual basis.

Over the past five years, the urgent care market has been growing at a steady clip due to a shortage of primary care doctors, long wait times at emergency rooms and the expansion of insurance coverage under the federal health law, according to a November 2015 report from IBISWorld.

The research firm tracked industry revenue of $16.2 billion in 2015, and projected growth to $19.7 billion in revenue by 2020.

Currently, about 7,100 urgent care centers operate in the U.S., according to the Urgent Care Association of America, a trade group based in suburban Chicago.

"Overall, there is increased interest by hospitals in urgent care centers, either joining with others ... or by acquiring urgent care centers as part of their outpatient ambulatory networks," the trade group said in a statement. "Both of these trends are expected to continue."

By the end of next year, MedExpress wants to grow from its current base of 177 urgent care centers across the country to a figure that's "north of 250" centers, said Dr. Frank Alderman, the chief executive at MedExpress, which has a headquarters office in suburban Pittsburgh.

Alderman didn't say how much the company invests when creating centers. Each clinic initially is staffed by between 20 and 25 workers, he said, including physicians, nurses, X-ray technologists and center managers.

Centers are open daily from 8 a.m. to 8 p.m. Appointments aren't necessary. Beyond urgent care, MedExpress offers basic wellness services such as physicals and immunizations. It also offers employer health services such as pre-employment screenings and physicals.

"The centers are totally consistent," Alderman said. "If you work at one here in Pittsburgh, you can work [at one] in the Twin Cities. ... The consumers really appreciate that, as do our staff."

MedExpress is "positioned at the convergence of health care and retail," he said, adding: "You earn the right to grow by having a strong foundation of quality." Minnesotans will learn about the model, he said, through the company's marketing and community work plus patient testimonials.

In the Twin Cities, most urgent care centers have been operated by health systems that also operate hospitals and clinics, said Charland of Merchant Medicine.

Whereas health systems tend to stick within regional markets, some operators like MedExpress have drawn on private equity backing over the years, Charland said, to expand beyond state lines.

Health systems often provide urgent care in medical office buildings and hospital campuses, Charland said. Companies like MedExpress set up shop in retail areas that offer easy access.

Charland does consulting work with health systems, and tells them they have to "up their game" to at least match the experience offered by independent operators.

"What they have going for them is a trusted brand, and that is something that MedExpress will struggle against," Charland said. "With health care, trust is a pretty important factor."

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck