PM Pediatrics has received $50 million in private equity investments to go nationwide with its pediatric urgent care business.
The New Hyde Park-based company has 50 locations in 11 states and plans to open about six more in the next three months. Eight of its locations are on Long Island.
The first PM Pediatrics opened in Syosset in 2005. By 2012, the practice had four offices. That’s when investments from private equity funds began to spur aggressive growth.
“It took a while to ramp up, get people to trust us and find us, but the concept had merit, and we slowly grew,” said Steven Katz, co-founder and co-CEO of PM Pediatrics.
Manhattan-based Jefferson River Capital and Manhattan-based Scopia Capital Management are the PM Pediatrics investors.
"We see PM Pediatrics continuing to grow not just by increasing its store base within its existing markets but also as it expands its footprint to new geographies across the country who have not yet had access to pediatric urgent care," said David Wittels, president of Jefferson River, who is also on the PM Pediatrics board as Scopia's representative.
He declined to break down how much each group invested.
The concept’s origins are a story common to most parents: Katz had only one place to turn when his kids got sick during off hours. He would call Dr. Jeffrey Schor, his Port Washington neighbor, friend and former college roommate, and ask if he could drive over.
The routine led Katz, who has an MBA from Stanford, to pitch a business plan to Schor — which turned into PM Pediatrics. Schor is co-founder and co-CEO at PM Pediatrics.
“When kids got sick after hours, they often ended up at the emergency department when they didn’t need to,” Katz said, adding that hospital visits are far more expensive than urgent care visits. “There was a great opportunity to open a business like this.”
PM Pediatrics locations are open from noon to midnight every day.
The urgent care business has grown throughout Long Island, and nationally. For example, Northwell Health-GoHealth Urgent care, which opened its first location in 2014, now operates 52 locations across Long Island, New York City and Westchester.
Lake Success-based ProHEALTH Care also operates an urgent care network, including 31 urgent care centers in New York and 24 in New Jersey.
Manhattan-based CityMD, which acquired rival Stat Health in 2018, has also grown in the region.
“The industry is taking off partly because it’s convenient,” said Margaret Simat, an East Coast surveyor for the Urgent Care Association, an industry advocacy group based in Warrenville, Illinois. As a surveyor, she is responsible for ensuring standards are met at urgent care facilities.
Simat estimated there are about 10,000 urgent care centers nationwide, about triple the number of locations 10 years ago.
“I expect this to continue, because there is a shortage of primary care doctors,” she said. “The medical students today are often going into specialties.”
There are fewer pediatric-specific urgent care centers such as PM Pediatrics.
“Unlike most other urgent cares, PM Pediatrics focuses exclusively on pediatric patients ... the hours we are open, the use of providers that are all pediatric specialists, the child-friendly environment, the equipment, and the training and friendliness of the staff reflect this," Schor said.
Other providers offer some pediatric-focused centers as well.
Northwell Health and GoHealth Urgent Care operate two pediatric locations on Long Island, in East Northport and Hewlett. The facilities, open 10 a.m. to 10 p.m. seven days a week, are branded as Cohen Children’s/Northwell Health-GoHealth Urgent Care.
“Our goal is to create a regional network of the pediatric centers,” said Adam Boll, vice president of Northwell Holdings & Ventures, the health system's for-profit unit. “There is a significant need for more of these locations. Parents often want their children to be seen by a board certified pediatrician, and when our locations are open, a board certified pediatrician is always there.”
ProHEALTH has a pediatric-specific urgent care location in Wantagh, and plans to open a Manhattan location in early 2020, said Dr. Zeyad Baker, the group's president and CEO. He said ProHEALTH plans to add more pediatric locations.
PM Pediatric said its next wave of expansions will be in areas where the group already has a presence, including the I-95 corridor from Washington to Philadelphia.
“There is a lot of open space to fill in those areas,” Katz said. “We need critical mass in those markets, and we’ve been able to find good locations.
“On Long Island, while there are areas we’d like to have a presence, we feel like we have pretty good coverage, so the next group of locations won’t be here,” he said.
PM Pediatrics has partnered with Children’s Health, a pediatric group in Dallas, to operate locations in Texas.
Katz said partnering with Children's, a well-established pediatric brand in the competitive Dallas market, “would give us instant credibility and recognition, allowing us to ramp up faster than we would otherwise.”
The company also partners with WakeMed Health & Hospitals in North Carolina, where PM Pediatrics has two locations.
Company: PM Pediatrics
HQ: New Hyde Park
Locations on LI: 8
Employees nationwide: 1,200
Hours: Noon to midnight