Presumed Diseconomies of Scope vs Downward-Sloping Demand in the Market for Unscheduled Care

Abstract: There is substantial interest in using urgent care centres to decrease lower-acuity emergency department (ED) visits. Using 2008–19 insurance claims and enrolment data from a national managed care plan, we examined the association within ZIP codes between changes in rates of urgent care centre visits and rates of lower-acuity ED visits. We found that although the entry of urgent care deterred lower-acuity ED visits, the impact was small. We estimate that thirty-seven additional urgent care centre visits were associated with a reduction of a single lower-acuity ED visit. In addition, each $1,646 lower-acuity ED visit prevented was offset by a $6,327 increase in urgent care centre costs. Therefore, despite a tenfold higher price per visit for EDs compared with urgent care centres, use of the centres increased net overall spending on lower-acuity care at EDs and urgent care centres.