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Exer Urgent Care Takes Outpatient Model to RSM

Plans to Further Expand Presents in South OC

Exer Urgent Care opened its 30th outpatient facility in Rancho Santa Margarita, with plans to further expand into South Orange County.

“There is a real lack of urgent care (in the area)—we hope this will be the solution for them,” Chief Executive Rob Mahan told the Business Journal at its Nov. 9 opening that was attended by Mayor Anne Figueroa and Chamber of Commerce President Josh Bastian.

The clinic is joining a rush to provide more medical services in the southern part of the county, where new housing is adding thousands of new residents.

Providence Mission Hospital Mission Viejo is planning to spend $712 million over the next seven years to expand its operations in South Orange County, including a new hospital building and two urgent care facilities in San Clemente and Rancho Mission Viejo.

MemorialCare Saddleback Medical Center on Sept. 20 broke ground in Laguna Hills on an $80 million Women’s HealthPavilion that it says will transform women’s healthcare in South Orange County.

Hoag Memorial Hospital Presbyterian this year opened a new urgent care facility in Monarch Beach in Dana Point. Hoag this month announced a campaign to raise $300 million to expand its operations in Irvine.

$1B Hospitals

A year ago, Exer entered Orange County and now has four locations altogether, including Irvine, Huntington Beach and Costa Mesa.

Mahan said the clinic plans to next expand into San Clemente, Laguna Hills and Laguna Niguel.

The El Segundo-based company is concentrating on expansion in the three counties of Orange, Los Angeles and Ventura, which together have 14 million residents, he said. Each clinic generally has 10 to 20 employees, not including the doctors who are contractors.

The Exer clinic is part of a movement in the medical industry away from hospitals that can cost $1 billion or more, toward ambulatory services to provide outpatient care.

Its newest clinic, which has six patient rooms in 4,200 square feet of space, cost about $1 million to build, Mahan said.

“A hospital and an ER are very expensive to build,” Mahan said, adding that they must respond to 38 different regulatory bodies.

The Exer clinic, located in the Santa Margarita Marketplace near the 241 Toll Road, won’t see patients with life-threatening problems such as gunshot wounds or heart attacks. Instead, it handles routine visits such as colds, flu and rashes. In addition, it provides X-rays, lab tests, immunizations and a medical weight loss program. It also offers free physical exams to students who need them to compete in high school sports.

“We can see 80% of the patients seen in the ER nowadays. This allows us to help decompress the ER,” Mahan said. “We want to be a complement to the healthcare system.”

The clinics are open seven days a week, from 9 a.m. to 9 p.m. They are often built in the same manner such as drawers being located similarly so employees can move effortlessly among different clinics.

Founding

Exer Urgent Care was founded in 2013 by Cherlin Johnson, who was a doctor in an emergency room.

“She thought there must be a better way, waiting hours and hours and then getting a $2,000 bill to have a splinter removed,” Mahan said.

Mahan, whose background includes executive stints at PricewaterhouseCoopers, Long Beach-based mental health center Elements Behavioral Health and Denver-based DaVita Kidney Care (NYSE: DVA), became Exer’s CEO in 2016.

Its investors include New York-based Orangewood Partners, which manages more than $800 million in assets, and Providence Health, which is the investment arm of the giant Providence healthcare system.

Exer, which has served more than 1.6 million patient visits to date, accepts both PPO and HMO insurance from at least eight providers, including United Healthcare, Aetna and Blue Cross of California.

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Peter J. Brennan
Peter J. Brennan
Peter J. Brennan has been a journalist for 40 years. He spent a decade in Latin America covering wars, narcotic traffickers, earthquakes, and business. His resume includes 15 years at Bloomberg News where his headlines and articles sometimes moved the market caps of companies he covered by hundreds of millions of dollars. His articles have been published worldwide, including the New York Times and the Washington Post; he's appeared on CNN, CBC, BBC, and Bloomberg TV. He was awarded a Kiplinger Fellowship at The Ohio State University.
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