On-site and near-site health clinics: An attractive benefit with proven ROI
Despite skyrocketing health care costs, our health care system has a poor track record of actually improving the health of individuals and populations. That leaves many employers justifiably frustrated at the lack of return from this huge investment in their employees.
So why do so many employers continue to pay for health care through an expensive system that doesn’t improve health? Often, it’s because they’re not aware there’s another, better option. The on-site and near-site clinic model limits the upward trajectory of health care costs while improving employee and dependent health outcomes.
On-site and near-site clinics offer a rare opportunity for government employers to provide an attractive benefit that not only improves employee health but also cuts costs for both employer and employee.
How it’s different
A patient’s health can’t be effectively managed with a 15-minute physician visit during an annual physical. That’s just not enough time for doctors to work with their patients to understand and help them address their health challenges and goals. We can’t really fault the doctors – they’re simply trying to operate within a system that rewards seeing as many patients as possible, not how healthy those patients are.
The on-site and near-site clinic model doesn’t work that way.
Most importantly, the on-site and near-site clinic model provides patients and doctors the time they need to positively affect patients’ health. Employees and dependents typically have unlimited, no-cost access to the clinic’s professionals and its services, which include office visits, disease management, health coaching, referral management and some prescription drugs and lab services.
But there’s so much more.
The clinic offers a convenient at-work or close-to-work location for workers to access same-day care. The beauty of the model is its focus on managing chronic conditions. It achieves lower costs and better outcomes in tandem by aligning incentives properly around improving the health of the patient, not seeing as many patients as possible. Employers typically pay a fixed amount per member to fund the clinic, which does not process insurance claims. Such clinics can meet most worker health needs that don’t require specialist intervention or surgical or hospital care.
One-third of U.S. employers with 5,000 or more workers now offer such clinics to employees and dependents, according to Mercer’s 2018 Worksite Medical Clinics Survey, up from 24% in 2012 and 17% in 2007.
The model shows strong growth among employers with 500 to 4,999 employees too, with 16% currently providing a medical clinic for employees and another 8% considering adding one in 2019. Employers that measure return on investment report up to $1.50 for every dollar invested, according to the Mercer survey.
In 2010 Monroe County Government, home of Bloomington and the University of Indiana, projected it would likely spend $500 million on health care in seven years. To make matters worse, 28% of its workforce accounted for 85% of its claim costs, primarily due to poorly managed chronic conditions.
Monroe County not only wanted to bend the cost of care trend but also to ensure every employee had convenient access to a primary care provider. In addition to seeing financial benefits, Monroe County saw gains in employee health, productivity and morale after its clinic opened.
After seven years, Monroe County realized:
- Net savings of nearly $6.6 million (180% ROI)
- Total member savings of more than $1.3 million based on average copays and coinsurance for office visits and generic drugs
- 61% of clinic users lowered their blood pressure notably
- 48% of clinic users with initially high levels of A1c (a measure of diabetes control), lowered their levels
- Almost all workers selected the clinic as their primary care provider
For employers, health care’s unrelenting cost growth and lackluster health improvement can seem insurmountable. Monroe County and dozens of other employers have found on-site and near-site clinics to be at least part of the answer.
Debra Geihsler, principal at Activate Healthcare, previously served as CEO and president of Harvard Vanguard Medical Group and Atrius Health System in Boston.