• Mesirow Investment Banking's healthcare sector report reveals a shift from traditional healthcare settings to urgent care centers (UCCs)
• Multiple factors in recent years, including COVID-19, led to explosive growth in UCCs
• UCCs also reduce the total number of uninsured and Medicaid visits to emergency departments by 21% and 29%, respectively, within a ZIP code
• Rapid growth and fragmentation of the UCC space have created fertile ground for M&A activity

CHICAGO, May 3, 2023 - Mesirow Investment Banking's Healthcare team announces the publication of a report that reveals the rise of UCCs and what this shift means for patients and investors alike.

The last few years have witnessed a shift in healthcare from office settings and emergency departments (EDs) to UCCs, a shift that COVID-19 accelerated. From 2013 to 2022, the number of UCCs in the U.S. almost doubled—from 5,307 to 9,928. With this increase has come a decline in emergency department visits, wait times and patient costs.

Lance Bell, Managing Director of Mesirow Investment Banking, said, "One of the predominant themes we are seeing in healthcare services is the push to drive care to lower-cost settings (ED → UCC → retail walk-in clinic → telehealth) and the consumerization of healthcare delivery. Firms as diverse as CVS (MinuteClinic), Amazon (One Medical), Walmart and Walgreens are all trying to merge medical treatment with retail philosophies like convenience, value and efficient use of time."

Despite this explosive growth, the UCC space remains highly fragmented with no clear leaders, making it fertile ground for M&A activity.

Key takeaways from the report include:

• The impact of UCCs:
  • An open UCC in a ZIP code reduced the total number of emergency department visits by residents in that ZIP code by 17%, due largely to decreases in visits for less emergent conditions.
  • UCCs reduced the total number of uninsured and Medicaid visits to the ED by 21% and 29%, suggesting that during the hours they are open, UCCs appear to be treating patients who otherwise would have visited the ED.
• The need for UCCs:
  • Overcrowding, long wait times and high costs in EDs, combined with the demands of COVID-19, made clear the need for alternative care options in the U.S.
• Urgent Care Centers are ripe for consolidation:
  • The consumerization of the UCC space is a classic example of a sector poised for rapid expansion and change, including M&A. It has all the hallmarks: rapid growth, fragmentation, established need and no clear leaders.

Please click here to read the full report.

About Mesirow

Mesirow is an independent, employee-owned financial services firm founded in 1937. Headquartered in Chicago, with locations around the world, we serve clients through a personal, custom approach to reaching financial goals and acting as a force for social good. With capabilities spanning Global Investment Management, Capital Markets and Investment Banking, and Advisory Services, we invest in what matters: our clients, our communities, and our culture. To learn more, visit mesirow.com and follow us on LinkedIn.

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