Dive Brief:
- A controversy has been quietly brewing in the streets of San Francisco where quintessential city retail areas are being increasingly transformed by new tenants: Healthcare providers.
- In particular, four provider groups including North East Medical Services (NEMS), One Medical Group, GoHealth Urgent Care and Golden Gate Urgent Care, have together opened more than 30 city healthcare spaces over the course of just five years, the San Francisco Chronicle reported.
- The extreme pace of expansion is primarily being driven by the increasing number of insured patients since the Affordable Care Act, NEMS told the newspaper, noting it serves double the number of patients it served prior to 2011 and its employee roster has shot up from 180 in 2008 to 650 in 2016.
Dive Insight:
The evolution of the city landscape in San Francisco comes amid the nationwide trend toward the rise of retail health clinics. Such moves to put healthcare where people are have been heralded by proponents for offering accessibility and in some cases lower costs, while opponents have questioned their value given their association with increased utilization and added pressures on traditional practices to compete with conveniences such as evening and weekend hours.
The move may also be borne somewhat of necessity; two reports earlier this year found demand for medical office space and ambulatory care centers to be at its highest in years due to the pressures from the ACA, which may be forcing chains and providers to get more creative.
What may come as a surprise to those coming at the issue from a healthcare perspective, however, is the potential for community opposition to losing retail space to the healthcare industry. Providers are bringing a kind of unwanted gentrification to San Francisco neighborhoods by driving up rent prices, and are perceived to be devaluing neighborhoods for the remaining retailers by reducing the spaces that are vibrant and open to the public, and thereby decreasing foot traffic.
Some healthcare spaces are reported to be using loopholes to comply with regulations in transitioning spaces from retail to medical. City lawmakers have responded by introducing legislation that would require conditional-use permits for medical spaces, which would impose a higher level of scrutiny.
Meanwhile, the providers stand by their efforts, arguing they are meeting local demand for medical services.