Direct care and labor unions collaborate

Healthcare costs are of major concern to employers as well as to their employees. Companies that provide healthcare as a benefit to their team members face increasing premiums, often in a time when they also realize they need to cut operational costs. Employees can have high deductibles and copays that add to the cost of their healthcare premiums. Some of these companies have discovered that working with their employee unions on a solution proves beneficial to all.

While unions can have contentious relationships with company management, the United Auto Workers (UAW) national leaders collaborated with one of its members’ employers to reduce healthcare costs and to keep the company operations in the US. Spirit AeroSystems, based in Kansas, was searching for a way to reduce its expenses and determined that it might need to move its Oklahoma operations offshore, which would mean hundreds of lost jobs.

UAW national leaders pitched a new idea to the management of Spirit AeroSystems: a direct care model of healthcare, specifically “a direct primary-care provider newly formed with investment from another national labor union.” Spirit implemented the new healthcare plan, which reduced costs for the company and for its employees and was able to keep its operations in Oklahoma.

The direct care model is based on monthly membership fees and is focused on preventative care. Unlike insurance coverage, there are no deductibles or office visit copays. The collaboration between Spirt AeroSystems, the UAW local in Tulsa, and the direct care provider, SolidaritUS, began in July 2018 when three direct care clinics were launched. Each of those clinics cares for fewer than 1,000 patients so each patient receives personalized care. The direct care model also provides same-day appointments and after-hours access.

The results of the direct care and labor union collaboration have been “significant.” Visits to the emergency room and to urgent care clinics are down as are health plan premiums. Although employees were at first skeptical, patient satisfaction surveys are now “off the charts.” The collaboration between the UAW, SolidaritUS, and Spirit AeroSystems is “one of a growing number of examples of labor unions taking control of rising healthcare costs by reimagining such factors as how care is provided and how employers contract with pharmacy benefit managers for prescription drugs.”

Nick Dealtry
August 27, 2019


Employer health care costs expected to rise 6 percent in 2020

An annual survey conducted by PwC’s Health Research Institute (HRI) has revealed an increase in health care costs for employers as well as for their employees. The survey also indicates a number of unique strategies planned by employers to help reduce those costs. HRI surveyed health industry executives and benefits experts and combined those results with the results from a national consumer survey and a survey of more than 550 employers to compile the report, “Medical cost trend: Behind the numbers 2020.”

Among the key findings in the survey, HRI found that:

  • Drug spending will grow faster. Over the next seven years, “retail drug spending under private health insurance is projected to increase at a rate of 3 percent to 6 percent a year.”
  • Chronic diseases will continue to plague the populace. Chronic diseases such as diabetes and obesity contribute significantly to the higher costs of healthcare. HRI states that “sixty percent of adults have a chronic disease, with 40 percent managing two or more.”
  • Employees and their families will take advantage of greater access to mental health services. When employees are dealing with mental health challenges, the costs of their care can rise dramatically. HRI concludes that “in the long term, employers may find that addressing mental health is a powerful deflator of medical cost trend.”
  • Employers will continue to open more expansive worksite clinics. The survey found that “38 percent of large employers offered an onsite health clinic in 2019, up from the 27 percent that offered a clinic in 2014.” Another 13 percent of employers surveyed stated that they were considering offering their employees the benefits of a worksite clinic.
  • Employers and payers will nudge people toward lower-cost sites of care. Less expensive options such as telemedicine are growing in popularity with employers and employees.
  • More employers will help employees maximize their benefit packages. The survey found that “More than 80 percent of consumers surveyed by HRI with employer-based insurance would be interested in a ‘menu’ of options for care across virtual and physical settings.”

The HRI report concluded that “2020 likely will be, in some ways, a turning point in the long arc of employer-sponsored insurance, a year in which more employers fight back using new tools and strategies to control the ever-growing costs to their own organizations, their employees and their families.”

Nick Dealtry
July 23, 2019


What does an ideal EHR for employer clinics look like?

Employer sponsored healthcare clinics are particularly concerned with data security. Employees want to be sure their medical information cannot be accessed by their employer. An ideal electronic health record (EHR) solution for an employer clinic will not only be efficient and reliable but also safe and secure.

One of the main attractions of the on-site or near-site healthcare clinic for employees is the convenience factor. Typically, employees can seek out primary care services, immunizations, and treatment for minor illness or injury without having to take an entire day off from work. They expect the employer clinic to run efficiently and the on-site clinical staff to be able to easily access their medical data without any delays or other issues. The EHR used in the employer clinic must be able to offer that efficiency.

Often, an employee needs to be seen by specialty providers. The on-site or near-site employer clinic physician may need to collaborate with other physicians, labs, or healthcare facilities to ensure the patient is receiving appropriate treatment without duplication or error. An ideal EHR will also provide this capability, enabling the primary care physician to coordinate care without having to wait on medical files or care orders to be transferred via fax or multiple telephone calls.

Employees may have a primary care provider but use the on-site clinic for visits specific to an illness or injury. In those cases, the clinic physician can input visit notes and test results for the employee’s primary care physician to view. An ideal EHR solution enables the healthcare provider to view patient information, including visit notes, lab results, and prescriptions, with one touch. Likewise, communication between patient and physician as well as between multiple providers is seamless and secure in an ideal EHR.

Employer clinics are growing in popularity with both employers and employees. The convenience and cost savings are attractive benefits for recruiting job candidates and for retaining quality employees. A high quality EHR solution is key to offering employees the security and efficiency they expect in their on-site or near-site clinic.

Nick Dealtry
March 5, 2019


How on-site and near-site employer clinics can improve employee morale

Convenient access to primary care services in an on-site or near-site employer clinic has been shown to have many benefits for employees as well as for their organization as a whole. Employees who have the opportunity to take advantage of preventive care and immediate treatment for minor illnesses or injuries are physically healthier. Employers who offer on-site or near-site clinics as a benefit to their employees often realize lower absentee rates and higher production numbers.

On-site and near-site employer clinics can also improve morale among employees who actively use the services. Additional wellness benefits such as fitness centers or life management classes add to the benefits of the healthcare clinics. According to a recent survey of more than 1,200 full-time employees who work at companies with more than 3,000 employees, “providing a physical work environment that supports healthy decisions and participation in wellness programs (is) associated with reporting a positive work experience.”

The research, conducted by Optum, found that “employees who have access to 7–8 health and wellness program categories through their employers, compared to employees with no access to such programs, are:

  • 2.9X more likely to recommend their employer as a place to work
  • 1.5X more likely to continue working for their employer
  • 3.3X more likely to be proud to work for their employer

These numbers are indications of increased morale among the employees who actively engage in the employer-sponsored healthcare programs. Engagement is key to the results, and employees are more likely to engage in primary care services as well as health management programs such as weight loss or smoking cessation clinics that are convenient, either on-site or near-site.

The Optum study reports that “disengaged workers can be costly, both to the bottom line and to employee morale. In the United States, an estimated $450–$550 billion a year is lost to businesses due to less productive workers.” On-site and near-site employer clinics can help boost employee morale and significantly improve the bottom line for the employer.

Nick Dealtry
February 19, 2019


What employers want from on-site clinics

An on-site clinic is a healthcare facility that is located at an employer’s physical location. The on-site clinic offers employees easy access to basic primary care services and, in some cases, additional services such as pharmacies and fitness centers. The clinic setting can range from a single healthcare provider offering immunizations and well checks to a fully-staffed facility equipped with multiple options available for employees and their families.

Generally, an on-site clinic has as its goal, “easy access and immediate attention, at little or no cost, for a host of services and products that an employee would normally have to leave the worksite to obtain.” What are the top priorities for employers who offer their employees the convenience of access in an on-site clinic?

According to the 2016 Healthiest Employer® “Onsite Workplace Clinic Survey” of employers, brokers, and vendors, employers want two basic outcomes from their on-site clinics. Their top priority is employee health and productivity. In fact, many employers are expanding the basic immunizations and preventative primary care services to include wellness centers, life management programs such as smoking cessation, and other services designed to help employees improve and maintain their quality of health.

Employers’ second most important priority when offering employees on-site clinic services is healthcare cost reduction. Healthcare costs are rising, for employees and employers. On-site clinics can help keep some of these costs in check. In addition, the convenience of access to healthcare encourages more employees to visit a physician when they are ill or to prevent becoming ill. As a result, absenteeism and presenteeism (showing up for work when feeling ill and possibly contagious) are reduced significantly.

The study also found that those employers who do not offer on-site clinics have somewhat different priorities. According to its findings, “fewer than half of employers without onsite clinics have invested in disease management or smoking cessation, and barely half have invested in health coaching or weight loss interventions.”

Nick Dealtry
February 6, 2019


How DPC care can segue to direct-to-employer care

Change is generally a challenge, particularly in the workplace. Employees who are told they must change their healthcare plan may not always react positively. In fact, employers may not want to change their company healthcare plan, at least not all at once. One option is to segue to a new plan in small steps, especially when it entails a new concept, as is the case with direct primary care (DPC).

DPC practices are a relatively new breed but are growing in popularity. The DPC model involves patient membership fees rather than insurance reimbursements, as well as more direct involvement by the independent physician. The DPC practice harkens back to the day of the family doctor. House calls, after hours communications, and personalized care are among the benefits cited by DPC physicians and their patients.

Employers have moved slowly toward the DPC trend but are still somewhat hesitant to forego traditional healthcare coverage completely. One option is to offer employees the choice of a health insurance plan such as a PPO product in addition to the DPC practice. That’s exactly what one company – a large healthcare provider itself – has done for its employees.

CHI Health is the Catholic Health Initiatives (CHI) division for Nebraska and southwest Iowa. In 2017, CHI Health launched its own DPC practice to augment its traditional healthcare services. The DPC was designed to care for CHI Health’s own employees primarily. CHI Health employees are given the option of enrolling in traditional PPO coverage or participating in the DPC. Approximately 1,130 of the organization’s 20,000 employees and beneficiaries opted into the DPC model during the first quarter of 2018.

Employees were reassured that if they needed care beyond the basic primary care services provided by the DPC that they could seek out specialty providers and other catastrophic services such as hospitalization for the same deductible costs as the PPO-covered employees. However, according to HealthLeaders, “early results suggest DPC participants use these more-expensive options less.”

In fact, the costs were significantly lower for DPC-covered employees during the first quarter of 2018. Facility and specialist claims were 20% less for those employees in the DPC practice than for those employees enrolled in the traditional PPO plan.

Employers can test the waters by segueing employees to a DPC practice, offering the choice for those who do not readily accept the change. After demonstrating both cost savings and improved outcomes, the DPC may be seen as the preferred choice for all going forward.

Nick Dealtry
January 22, 2019


Employer health clinics and value-based care

Employers are constantly looking for ways to reduce costs. In the prevailing move toward value-based care, those employers are also searching for innovative strategies to help their employees become healthier and maintain their health. On-site and near-site clinics have been shown to be a viable solution for both challenges.

A report from the Duke-Margolis Center for Health Policy and the Robert Wood Johnson Foundation cited the connection between population health management and workplace clinics, stating that, in particular, the employer programs help manage employees’ chronic conditions. Approximately 90 percent of US healthcare costs are related to chronic conditions such as diabetes or high blood pressure.

The report states that “Employers have targeted this issue in a number of ways. 62 percent of large employers and 38 percent of small employers offer health risk assessments, with an even larger percentage providing programs like smoking cessation, lifestyle coaching, and weight-loss management. In another survey, 20 percent of employers report having opened onsite clinics, and 8 percent have near-site or multi-employer clinics, with a larger percentage of employers considering it.”

Larger companies such as SAS, National Public Radio (NPR), USAA, Goldman Sachs, and Capital One Financial offer their employees basic primary care services through on-site or near-site healthcare clinics. Additionally, companies such as Apple, Amazon, Berkshire Hathaway, and JPMorgan & Chase have announced plans for internal healthcare ventures that will provide health and wellness services to their employees.

The Duke-Margolis Center report details the importance of offerings such as employer health clinics as they relate to value-based care. “Employer-sponsored health insurance coverage accounts for 49 percent of insured Americans. If the U.S. health system is to be transformed into one that rewards value, then employers must not only participate in the transition, but play a leading role.” The report continues to explain that “Employers have an interest in the value of care not only because they help pay for their employees’ health insurance coverage, but also because better employee health means fewer missed days of work and better productivity.”

Employers need healthy employees to help reduce their own costs, to maintain a quality level of productivity, and to reduce absenteeism. In general, the current transition to value-based care is welcome news to most employers, with its focus on quality care at the physician’s office and cost containment for both employer and employee.

Roy Steiner
December 14, 2018


The benefit of direct care for on-site and near-site employer health clinics

Employers are as concerned about healthcare costs as their employees and, as such, search for alternatives to traditional healthcare plans for those employees. The direct care model has been proven to offer benefits as the provider of employee healthcare at on-site and near-site employer health clinics.

One company, in particular, that recognized the potential for those benefits conducted a case study of a group of its employees before offering on-site direct care as a company-wide employee healthcare plan. DigitalGlobe, based in Colorado, conducted its study from June to December 2015 by offering the direct model to its Colorado employees. The company also has employees in Tampa, Florida, and Herndon, Virginia.

Company leaders had reviewed information about the direct care model and recognized that it saved businesses and their employees a significant amount of money while providing high quality healthcare. DigitalGlobe searched for a direct care provider and conducted their study with three goals in mind:

  1. Improve the overall health of employees.
  2. Provide employees a more positive healthcare experience.
  3. Reduce healthcare costs for the employees and the company (a self-insured entity).

Employees, in general, realized a number of benefits from their direct care healthcare. The ability to communicate directly with their provider by phone, text, and email was particularly valuable to them. In addition, they were appreciative that they did not have to wait long when they visited the doctor and did not feel rushed during the appointment.

Another benefit came about because of the closer relationship and the focused nature of the provider visit in the direct care on-site model. The company’s report on their study indicated that “there were several instances in which serious health issues (specifically, pre-cancerous conditions, pre-diabetes, and early stage liver cirrhosis) were discovered during a routine checkup or an unrelated treatment—healthcare encounters that the participants readily admit might have been postponed or neglected in the past.”

In addition, the direct care on-site physicians were able to focus on more personal challenges with the company’s employees, such as stress management, dermatological concerns, and weight loss. Many employees “reported that the added level of accountability … was a significant factor in achieving health and wellness successes in those and other areas.”

The company also realized cost savings during the very brief study period. For example, the company estimated “a diversion of costs averaging $54.31 per-member per-month and additional care prevention of $99.99 per-member per-month, for a total savings of $221,442 over the seven months.”

Roy Steiner
December 10, 2018


Understanding what kind of companies can benefit the most from on-site, near-site employer care

Most of the discussion around on-site healthcare clinics highlight larger companies that offer the benefits to their employees as incentives for recruiting, retention, and improved health. In reality, however, there are different options available for on-site and near-site employer care that are appropriate for companies of all sizes.

Larger companies that have the resources can benefit significantly from on-site healthcare clinics. Establishing a clinic on the company’s premises may require hiring staff, investing in a facility, and funding all the necessary expenses of a private clinic. The rewards for the employer are seen in improved productivity and a healthier, happier workforce.

On-site employer healthcare clinics typically work well for large companies that have a limited number of facilities. Employees who work at satellite locations or other off-site facilities may not be able to take advantage of the employer clinic located on the campus of the main worksite. Most employers offer the on-site clinic services to employees’ families as well, so the on-site care will also benefit those employees who live relatively close to the company’s main site.

Large companies with multiple facilities and smaller companies may benefit more from offering their employees healthcare at a near-site clinic. As discussed in a recent article in Employee Benefit News (EBN), “For smaller, self-funded companies that do not have large budgets for additional benefit options, near-site clinics are certainly a more affordable option.”

Near-site clinics are run by an independent staff and require no start-up investment on the part of the employer. The clinics are shared by a number of employers, who generally pay a monthly fee to the clinic for providing healthcare services to their employees. Near-site clinics work well for smaller companies that do not have the resources to build a clinic on-site and for larger companies that have employees (and their families) scattered in various locations.

Roy Steiner
November 12, 2018


Global on-site care market is growing

Employers in the US are recognizing the benefits of on-site healthcare for their employees in growing numbers. Companies benefit from cost savings, improved productivity, and reduced absenteeism. Employees benefit from the convenience of accessing basic healthcare services such as preventive care, immunizations, and well checks, without losing time at work. Treatment for illness or injury is also made more expedient with on-site clinics.

The growth of on-site healthcare facilities is growing across the world as well. Future Market Insights (FMI) recently published a report, “On-site Preventive Care Market: Global Industry Analysis (2012-2016) and Opportunity Assessment (2017-2027)” that examines the global on-site care market. According to FMI, the compound annual growth rate (CAGR) of on-site preventive care is expected to grow 7.1% from 2017 to 2027.

In its report, FMI points out that the “standards set in the workplace for the safety of workers and the need to adhere to workplace norms have triggered the demand for on-site preventive care.” In addition, “the increasing incidences of workplace illness has also made it an obligation for employers to follow employee safety codes and adopt on-site preventive care.”

Over a third of the global on-site preventive care market share is held by North America. Western Europe follows closely. Within the North American market, the US market is growing as a “mature market,” in which many employers have adopted workplace wellness programs in addition to providing on-site healthcare clinics for their employees. Programs to help employees stop smoking, lose weight, and general maintain their health contribute significantly to the benefits of on-site care.

On-site healthcare clinics also help employers stay competitive across the globe. The benefit of on-site healthcare is used to attract and retain quality talent. Particularly in the US, where the unemployment rate is low and qualified workers may be challenging to recruit, the added benefit of on-site health, coupled with wellness programs, can be an enticing incentive to potential new hires.

Roy Steiner
November 5, 2018