Matthew E. May, Special to Upstart Business Journal
November 15, 2012  |  3:12pm EST

Too often we overlook the power of small businesses to solve the world’s most wicked problems. Take the case of WellnessMart MD. This small business has successfully addressed some vexing areas of the national health care tangle.

I hadn’t heard of WellnessMart until a friend told me that I could get a body composition test for $10 there, instead of paying $75 at my doctor’s office. I could just walk in without an appointment, rather than waiting three weeks to see a doctor, and be done in less than five minutes.

WellnessMart is a refreshing concept: It’s a retail doctor’s office.

My friend didn’t exaggerate. Although I did spend well over an hour there, it was entirely by choice: I was talking to the founder, Dr. Richard McCauley, and my chat with him was fascinating. A graduate of USC Medical School, Richard was an emergency-room physician for several years before developing a new idea for health care.

WellnessMart looks nothing like a typical medical office. It has an attractive retail storefront, ample parking, and no waiting room. That’s because there’s no waiting. In fact, walking into a WellnessMart store feels like entering a hybrid of an Apple (Nasdaq: AAPL) store and a Kinko’s outlet. Picture white and lime-green walls, modern furnishings, an open floor plan, glossy floors, big-screen televisions, and walls covered with prominent menu boards listing services and cash pricing.

“I totally copied the Apple store concept,” McCauley confesses. And it turns out that he’s related to Kinko’s founder, business visionary Paul Orfalea—they’re cousins.

But what I found really intriguing was his business strategy: where in the market he had chosen to play and how he planned to win.

“There are two kinds of people,” states McCauley. “Healthy and sick. Why do sick people and healthy people go to the same place? Every other medical site treats both. We don’t. We only serve healthy people. It’s called ‘health care,’ not ‘sick care.’ Health care isn’t just for unhealthy times. There are so many routine-maintenance kinds of things you need from time to time. My sole goal in life is to make that quick, easy, and cheap.”

WellnessMart is a different and smarter way of doing some health-related things. At WellnessMart, people can get travel vaccines, cholesterol checks, or weight and nutrition consultations. McCauley can administer STD tests or cancer screens. You can buy physician-approved vitamins and take a few CPR classes.

It’s a study in what isn’t there, and the entire approach is one of simplicity and subtraction: no waiting, no appointments, no old magazines, no coughs and sniffles. “If you’re wheezing, sneezing, and coughing, you came to the wrong place,” says McCauley.

But WellnessMart can still help you if you’re sick. McCauley has compiled a directory for where to get the best price on health care services that WellnessMart doesn’t provide. You can look up where to go for doctor visits, X-rays, lab tests, dental work, and prescription drugs. They have books containing all the information spread out on a designated table, accessible to everyone.

McCauley said he got his idea while working as an ER doctor.

“I got really frustrated working on the front lines,” he tells me. “I was beginning to feel like I could never fix anything. As a physician, part of my job is to be a patient advocate within a very complex system that frustrates everybody involved. I wanted to go directly to the public—with a retail store.

“The idea was to create a medical marketplace with a certain level of transparency so people can see what things cost,” he says. “I thought, wouldn’t it be great if health care was more like car care at your favorite local mechanic?”

So McCauley broke away. He started in the hallway of a large health club, testing his concept with his potential consumer base. “Where do you find a well-contained concentration of healthy people? In a gym working out,” he says.

His concept proved popular. In 2008, McCauley launched WellnessMart MD in a small strip mall in a suburb of Los Angeles. He now has two stores in northern California’s Sacramento area and another in West Los Angeles, for a total of four.

WellnessMart represents a profound improvement for consumers: a place they can walk in and get honest answers.

“Let’s live in the real world where people have limited resources. Not everybody can afford everything,” McCauley tells me. “If people can get the same quality care for less money, let’s start there and give people the opportunity to experience health care in a positive way. Then, let’s allow them to ask questions, to learn. Traditional medical offices are not set up to teach. They’re set up to diagnose and treat.”

That’s another cue McCauley took from an Apple Store, the notion of a “genius bar.” Each WellnessMart store has an educational area equipped with large screens and plenty of seating. Training classes regularly teach CPR, first aid, and child safety.

“Want to fix health care?” McCauley asks. “All you need is one sentence: ‘Health care service providers must openly post the price of every service on a menu.’ Problem solved, game over. We have to break with convention, and that’s how to do it. That’s how we did it.”

It’s in that last remark that I found the take-home lesson of WellnessMart MD: If you want real breakthroughs, you have to break away from conventional thinking.

Matthew E. May is author of the new book, The Laws of Subtraction: 6 Simple Rules for Winning in the Age of Excess Everything, and founder of EDIT Innovation, a Los Angeles-based ideas agency.

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Most people buy car insurance for one reason – accidents.  If a car insurance company tried to sell a policy that cost four times as much every month but paid for oil changes and tune ups, few, if any, would purchase that policy.  The same can be said for home insurance, boat insurance – in fact, when you get down to it, nearly every form of insurance protects the policy holder against one thing and one thing only – major, unexpected financial loss.

When it come to health insurance though, the last two generations of Americans have become accustomed to their insurance to paying for not just unexpected accidents, but the equivalent of oil changes and tune ups.  This flawed philosophy has produced unreasonably high monthly premiums and unintelligible policies.

At WellnessMart, we teach a simple philosophy that solves this problem for consumers and healthcare providers:

1. use health insurance for only unexpected events and save huge money in monthly premiums
2. use the money you save to pay for the services you need by understanding your local medical marketplace

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WellnessMart MD opened in a strip mall at the high-profile corner of Watt Avenue and Fair Oaks Boulevard in mid-December, slightly ahead of schedule, in order to meet demand for H1N1 flu shots.

Touted as the “Kinko’s of health care,” the place looks more like a copy shop than a doctor’s office, but the menu boards list cash prices for lab tests, vaccinations, physician services and travel medicine.

The place also sells insurance for individuals, families and businesses, mostly high-deductible health savings accounts that cover catastrophes but leave it to patients to shop around for the small stuff.

Unlike Sutter Express Care, QuickHealth or national chains such as CVS-owned MinuteClinic, WellnessMart does not offer treatment of minor health conditions.

“We take care of well people, not sick people,” WellnessMart founder Dr. Richard McCauley said. “If you cough, you are not in the right spot.”

Services range from sports physicals and travel shots to blood tests and nutrition counseling. The company has compiled a directory for where to get the best price on health care services it does not provide, such as X-rays, dental work and prescription drugs.

The new entry into the market follows a shake-out in the region. Sutter shut three of its six clinics a year ago due to lackluster performance. And Burlingame-based QuickHealth Inc. closed its West Sacramento clinic, located in Wal-Mart, in August.

Cash pay at a fraction of the cost

The idea at WellnessMart is to make health care and health insurance easy, understandable and affordable by taking it retail.

“I have a strong feeling people can handle the health care system, given the right tools,” said Dr. Peter Wroblicky, an emergency room doctor at the Veterans Affairs hospital at Mather Field and owner of the Sacramento clinic.

The local clinic is WellnessMart’s first franchise. The only other WellnessMart, owned and run by McCauley, is in Thousand Oaks.

Wroblicky and McCauley are longtime friends; McCauley until recently worked as an emergency room doctor at a VA hospital in Southern California and sparked Wroblicky’s interest in medicine by taking him on rounds.

A self-described “terminal juvenile” at 45, Wroblicky worked as a burrito chef and stockbroker before going to medical school in Dublin. He lived in Fair Oaks as a child and used to ride his bike past the intersection that now houses his clinic.

He’s also a man with a mission.

“Rich and I kicked this idea around about how to provide better access to services,” Wroblicky said. “As physicians, part of the job is to be a patient advocate within a very complex system that frustrates patients and advocates. The idea was to create a medical marketplace with a certain level of transparency so people can see what things cost.”

Get more for less

McCauley runs the flagship center in Thousand Oaks. It was started in the hallway of a health club in 2006 and moved to a strip mall in early 2008.

He shopped around for services, asking providers for their best price for cash, and began building a referral directory. Wroblicky did the same thing here.

The results are eye-popping.

Patients can get a standard MRI at an imaging center near WellnessMart in Thousand Oaks for $500. That same center bills insurance companies $1,424 for the same test.

Similarly, a lab bill paid with cash cost $115, but the lab billed insurance companies $617.26 for the same test.

People buy car insurance for accidents, not oil changes, tune-ups and tires, McCauley said.

“If car insurance companies tried to sell policies that were many times more expensive but paid for routine maintenance, nobody would buy them,” he said.

That’s the problem with most health insurance, said McCauley, who is a licensed insurance broker. Wroblicky plans to get a license but currently refers clients to a broker in Southern California linked to the company.

WellnessMart sells regular insurance but touts buying health savings accounts for catastrophic coverage and paying for everything else out of pocket. The clinics bundle ancillary services and make them available at one place at posted prices.

San Corp. in Oxnard, which sells bodybuilding pills and powders and is a client of the WellnessMart in Thousand Oaks, saved $175 a month per employee by switching from traditional insurance to a high-deductible health savings account, controller Edward Schillo said.

The company turned around and put $150 per month in employees’ accounts and encouraged them to shop at the clinic for basic services.

“It’s great,” Schillo said. “They can call any time or go in.”

The company will provide the service at the posted rate or help employees find a provider that will do it for cash at a price they know ahead of time.

Recession slows rapid growth

The Sacramento clinic is just getting going. Menu boards are up, but not all the services are available yet.

Wroblicky works three 12-hour shifts at the VA hospital and staffs the clinic by himself four days a week. He’s looking to hire a licensed vocational nurse to help out

WellnessMart makes its money through service fees. Urinalysis, for example, costs $6, but the clinic charges a $25 fee to collect the specimen, send it to a lab and report the results.

“We are trying to be fair. We are in business to serve our customer, but it’s a business, too,” Wroblicky said. He’s put $30,000 into the venture and hopes to break even by year-end.

“I have no plans to leave the VA,” he quipped.

The key, like that for other retail clinics, will be getting enough traffic to make the place sustainable.

The idea is not to take business away from doctors, but to augment it with affordable, convenient service. The California Medical Association hasn’t taken a position so far. Some models are staffed by doctors, some not.

“We’re open to ideas as long as (the clinics) provide quality of care and access to physicians or other licensed providers,” CMA president Dr. J. Brennan Cassidy said.

The market for walk-in clinics slowed from a 350 percent growth rate in 2007 to 30 percent in 2008, according to a study released in November by the Deloitte Center for Health Solutions. It declined 5 percent for the first five months of 2009.

Blame the economic downturn, says Deloitte, but look for “cautious” growth to resume this year and next, and accelerate from 2012 to 2014.

Others are more bullish.

The National Center for Policy Analysis in Dallas expects the number of walk-in clinics to almost triple in the next four years in response to patient demand.

WellnessMart MD

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We have received word from the county that we are now able to provide H1N1 vaccine to the general public without restriction.

At WellnessMart, MD in Thousand Oaks, we currently have close to 1000 doses of the H1N1 vaccine in stock and are administering it without appointment anytime during regular business hours.  Our new Sacramento store is also well stocked with the vaccine.

The CDC recommends children 9 and under receive a follow up booster 28 days from their first dose of H1N1 vaccine.  Ages 10 and up need just one dose.

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The Thousand Oaks/Westlake Village Chamber of Commerce Ambassadors attended a Ribbon Cutting today hosted by WellnessMart in Thousand Oaks. WellnessMart is an exciting and very current concept for health coverage. Dr. Richard McCauley, owner, spoke to us in his introduction describing WellnessMart as a community retail store at the center of the change in health care to create a simpler, more efficient local health care system.

WellnessMart serves as an educational station for families in this community who want to take charge of their health care. They can help you find health insurance that makes sense so that you are not paying more than you need. WellnessMart makes routine blood tests easy and affordable with no appointment necessary and transparent pricing.

WellnessMart is a preventive health care superstore bringing a wide range of health-related products & services under one roof such as flu shots, travel medicine, CPR training, Vitamins and Supplements, VitaBots, Allergy Relief, Sun Protection, AED machines and much, much more.

The focus at WellnessMart is to give their customers information so they can make informed decisions about their health

This was a wonderful experience for the Ambassadors and we all were very amazed about this unique concept for health care. WellnessMart is located at 1610 E. Thousand Oaks Blvd, Thousand Oaks, Ca. For more information visit: http://www.wellnessmart.com.

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By Joann Groff joann@theacorn.com

Wellness Mart looks nothing like an average doctor’s office.

The white and lime green walls, glossy floors and big screen television make it feel more like a Mac store than a stuffy waiting room. There’s no crowds or sniffles or even a wait.

The man who greets patients, Dr. Richard McCauley, worked in an emergency room for years before developing a new idea for healthcare with his partner, Chris Spieth.

Wellness Mart’s walls are covered with menu boards like one would find at a sandwich shop, clearly spelling out prices for services. The men want consumers to look at health insurance the way they do auto and home insurance—something to purchase for the big disasters.

“You don’t go through your insurance to get oil changes and new tires,” Spieth said. “People should be buying health insurance strictly for the unexpected stuff. There is so much savings there.”

At Wellness Mart, people can get travel vaccines, cholesterol checks, or weight and nutrition consultations. Dr. McCauley can administer STD tests or cancer screens. Physicianapproved vitamins are available, and CPR classes are offered.

All services and products are listed on the menu boards with a flat-rate price. McCauley and Spieth call Wellness Mart the doctor’s office for healthy people.

“Why do sick people and healthy people go to the same place?” Spieth asked. “This is a different way for people to access the same level of care. It’s a smarter way of doing things.”

McCauley said it was five years ago, while working as an ER doctor, that he started to formulate the idea for the mart.

“I became frustrated on the front lines of healthcare,” McCauley said. “I was beginning to feel like I could never fix anything. I wanted to go directly to the public—a retail store. I thought, wouldn’t it be great if healthcare was like car care?”

Thus the idea for straightforward preventive healthcare was born; prices for services would be posted on the walls, and there would be no need for the hassle and markup of using the insurance agency as a middleman.

“It’s a profound improvement for consumers to have a place they can walk in and get honest answers,” McCauley said. “Let’s live in the real world where people have limited resources. Not everybody can afford everything. If people can get the same quality care for less money, let’s start there.”

The men have also compiled binders of information listing cash prices for lab tests, doctor visits, prescriptions and other services at local doctor’s offices. That way, patients can see that purchasing a lowcoverage insurance plan and paying out of pocket for the occasional sore throat is financially beneficial, they said.

“We are giving people the opportunity to experience healthcare in a positive way,” Spieth said. “We want people to ask questions, to learn. Doctor’s offices are not set up to teach. They are set up to diagnose and treat.”

The men think that, conceptually, Wellness Mart could be successful all over the country.

“There is nothing like this in America,” McCauley said. “Our customers love what we do.”

Wellness Mart is at 1610 E. Thousand Oaks Blvd.

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A California physician says the philosophy behind his WellnessMart is that the sick and the well should go to separate places for care.

By Karen Caffarini, AMNews staff.

April 28, 2008.

As an internist and emergency physician, Richard McCauley, MD, spends five shifts a month treating the sick and injured at a California VA hospital. But on just about every other day, he can be found at a local strip mall, catering to the healthy.

Dr. McCauley owns WellnessMart, which he describes as a health store for the healthy. Two different groups of patients, two different locations. That’s the way Dr. McCauley believes it should be.

“Why is it that sick people and well people go to the same place for care?” he asks. “What well people want is convenience and a place they can go to on their terms.

“If someone sneezes, we don’t take care of them. I tell them they’re in the wrong spot,” Dr. McCauley said.

Started in the hallway of a health club a few years ago, the health store moved to a storefront in a strip mall in Thousand Oaks, Calif., last month.

Walk-in visitors can find free informational materials on various diseases and free workshops on how to prevent them. There also are mannequins available that visitors can take apart to see where the organs are in the body.

The store also offers immunizations, annual checkups, vaccinations and travel immunizations. Borrowing from McDonald’s, Dr. McCauley said, WellnessMart lists all prices on a large menu board so patients know what they will be charged.

And while he doesn’t accept insurance, his center does sell it. But he sells only plans with a high deductible, which he believes makes more financial sense for families and eventually will bring down the cost of health care.

Candis Cohen, a spokeswoman for the Medical Board of California, said her organization has no problem with a physician selling health insurance, or with one who cares only for the healthy. She said there is a list of categories for which a physician can’t discriminate, but there is no rule against discriminating on the basis of sickness or wellness.

Dr. McCauley said the bulk of his clients are walk-ins, but church, school and employer groups use his wellness screenings and informational programs as well.

The physician said he conceived of the idea of the WellnessMart while serving as medical director for Fullerton, Calif.-based Beckman Coulter, which sells diagnostics to physicians’ offices. “I was very much involved with point-of-care diagnostics. From there, I had the idea that wouldn’t it be nice if the community had access to some of this information. It evolved from there,” he said.

Dr. McCauley believes that a lot of people don’t take advantage of preventive medicine because it is inconvenient and difficult to navigate. The purpose of his WellnessMart, he said, is to break those barriers.

The physician and two medical assistants staff WellnessMart from 10 a.m. to 7 p.m. six days a week, with Sundays off.

Richard Frankenstein, MD, president of the California Medical Assn., said that although he doesn’t know that much about WellnessMart, his concern is that Dr. McCauley has a plan for continuation of care for his patients, if needed. Dr. McCauley says he does.

“There are a lot of various ways in which health care is delivered. Some work better than others for some patients. As long as there are plans to ensure continuity and hand off important information to another doctor, physicians can have a wide variety of models,” Dr. Frankenstein said.

Only in business for a couple years, and at the strip center for about a month, Dr. McCauley said it’s too early to tell if his concept will work, or if any other physicians will follow his example.

“I don’t expect it to make a profit in the next couple years. I didn’t go into it to make a profit. I’ve been happy with the move,” he said.

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A Retail Clinic for Healthy People

Health care would be a great business if it weren’t for all the sick people. Richard McCauley, MD, may have fixed that.

“If you cough, you’re in the wrong place,” he told the Ventura County Star. His store, WellnessMart, sells things like screening tests, checkups and vaccinations. McCauley doesn’t take health insurance, but he’d be glad to sell you a health insurance policy.

The store, which recently moved from the hallway of a health club to a strip mall in Thousand Oaks, Calif., posts prices for everything on the wall. Nutrition counseling for a month costs $40, and vaccination for hepatitis A costs $89, the County Star says.

The store has the ring of the retail clinics popping up in drugstores and big-box stores, offering basic health-care services. The key difference, of course, is that retail clinics treat sick people, albeit only those with simple ailments such as sore throats.

Critics have suggested that many new health care businesses aim to skim off the simplest, healthiest patients, leaving complex, sicker patients for others to deal with. McCauley’s business certainly fits the bill.

But he argues that the cost and difficulty of seeing the doctor means many healthy people go without basic preventive care. “Why is it that sick people and healthy people go to the same places for care?” he says.

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WellnessMart is T.O. illness prevention center

By Tom Kisken tkisken@VenturaCountyStar.com – Thursday, April 3, 2008

As an internal medicine doctor who works in an emergency room, Richard McCauley takes care of the sick. As owner of the WellnessMart in a Thousand Oaks strip mall, he’s all about the healthy.

“If you cough, you’re in the wrong place,” he said inside a business billed as the antidote to traditional healthcare.

Because his preventive healthcare business is different, it’s almost easier to explain what it isn’t. It’s not a doctor’s office. It’s a retail store designed to operate more like a Kinko’s, where people walk in and get what they need.

There’s no waiting rooms, no receptionists and few if any appointments. People walk in to find a doctor and a medical assistant standing behind a long counter, poking at life-sized anatomy mannequins or using computers to demonstrate how plaque builds up in arteries.

The store doesn’t sell vitamins or medication but markets preventive health services like screenings that may tell a 33-year-old man he has a 17 percent chance of a heart attack over 30 years. It sells annual checkups, weight management, vaccinations and travel immunizations. Customers can buy programs that give them 24-hour, seven-day-a-week access to a doctor and help in compiling electronic medical records.

Free seminars, posted prices

Free seminars are held three times daily on topics like the sexually transmitted disease HPV and how to deal with insurance companies to navigate a broken healthcare system.

The store doesn’t stop at old-school boundaries that keep doctors from operating like other businesses. Prices are listed on a banner-like menu behind a long counter. The heart screening costs $100. Nutrition counseling for a month costs $40. Vaccination for hepatitis A costs $89.

People who want to bill a WellnessMart service to an insurance company are on their own. But McCauley does sell insurance policies at the store from providers like Blue Cross and Aetna. He says the best way to save is buying catastrophic coverage and paying for everything else out of pocket.

An MRI scan that an insurance company might price at $3,870 may cost $755 if people pay in cash, McCauley said. More bargains for various medical services offered at doctor’s offices, labs, imaging centers and pharmacies throughout the area are listed in directories at the shop.

“The problem with shopping for healthcare is no one knows the prices,” McCauley said. “If you don’t know the prices, how can you shop?”

And if the business sounds different and strange, that’s by design.

“There’s a small revolution that’s going on in this store,” he said. “There’s no place in the country that’s doing anything like we’re doing.”

He’s 46, lives in Malibu and works five ER shifts a month at a veterans hospital in West Los Angeles. His business was born from the convergence of several firmly held contentions.

“Why is it that sick people and healthy people go to the same places for care?” he asked, arguing the setup makes healthcare inconvenient for people who aren’t sick and means they don’t get screenings and checkups. People want to know about health risks and wellness but they don’t know where to go.

He blisters the insurance system, too, saying the industry marks up price so high that people think all healthcare is out of their price range.

“People can afford this stuff,” he said. “Healthcare is affordable.”

A time for experiments

The business started in the hallway of a fitness club in Thousand Oaks where McCauley offered screenings and preventive medicine. Several weeks ago, he opened up shop in a new Thousand Oaks shopping center, next door to a store that sells Bundt cakes. To attract attention, he placed an anatomy mannequin outside the front door.

Present the business concept to others and they cite the mixture of medicine and retail in-store-based clinics at Wal-Mart. They refer to doctors who build their practices around wellness screenings or using the Internet to increase their accessibility to patients.

“It sounds kind of different but there are a lot of different ways of enhancing people’s health,” said Dr. Richard Frankenstein, president of the California Medical Association. “We should be open to all kinds of healthcare systems.”

Others say healthcare is going through a transition in which doctors are trying to figure how to best serve patients and operate a successful business.

“There is a lot of experimentation going on right now,” said Margaret Laws of the California Healthcare Foundation. “Who’s going to come up with the right combination of what consumers want and what they’ll pay for?”

McCauley, who hopes to open more stores, is convinced he’s found the right combination.

“America’s ready for this because the healthcare system is broken,” he said.

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