Mushrooming medical homes change the game

QuadMedWashington County and Wisconsin are right in the middle of a seismic shift in the delivery of health care in America – from primary care as a loss leader for the big hospital corporations to medical homes for employes right at the work site.

The latest company to install an on-site clinic is West Bend Mutual Insurance, the largest employer in the county. West Bend has reportedly contracted with QuadMed, a subsidiary of QuadGraphics, another major employer in the state and county.

This clinic will be the “silver lining” for West Bend’s 1100 employes, who have always enjoyed great benefits and work environment. The “silver lining,” of course, is the tag line for West Bend’s advertising and refers to the protection offered to policyholders. But it also fits what the new benefit will do for its workforce.

They will enjoy convenient, relationship-based, long-term oriented, proactive and cost effective primary care on campus. Those adjectives do not generally apply to the in-and-out, symptom care in big system medicine.

West Bend and its people can expect to see significant improvements in their workforce health metrics, like the percentage of smokers, cholesterol levels, blood pressures and even body mass index.

They can also expect to see health costs drop 20-30% over time. That’s been the audited experience of QuadGraphics, which pioneered on-site health care starting in 1990. Its QuadMed now provides contracted medical homes for 120 major employers in 90 clinics across the country serving 150,000 members. That includes NML, Briggs & Stratton, Kohler, Rockwell and MillerCoors.

Quad is one of several dozen entrepreneurial providers that have jumped into the business of on-site or near-site clinics. Quad started with its own employees and fulltime doctors, but now offers a menu of other options, such as clinics headed by a nurse practitioner (NP).

Serigraph contracts for its on-site clinic with Interra Health, a Brookfield-based provider We also contract with Paladina Health, which has roots in Wisconsin, for part-time primary care doctors. Five other manufacturers in the county also use Paladina’s “concierge” doctors for their people.

HealthStats, Charlotte N.C., installed a clinic headed by a physicians’ assistant (PA) for the West Bend School District in 2013. Savings are already apparent. Office visits, for example, typically run $22 to $40 at on-site clinics vs. $160 to $190 at the big systems. Lab tests cost about half of what big systems charge.

HealthStats also won a trifecta with a contract for a clinic for the county, city and school district in Waukesha. It also services City of Kenosha employees. Other local governments and school districts are jumping on the band wagon.

You get the picture. Then nature of primary care in America is changing rapidly toward a model that keeps people well and out of the expensive, dangerous hospitals.

The big health care corporations have realized the challenge, and some, like Froedtert and Pro Health, are over-hauling their business models to offer clinics tailored for employers and their employees. They are late to the game, but appear to be responding to the competition.

A few hospital-based systems, like Bellin Health of Green Bay and Theda Care of Appleton, saw the train coming early and moved fast into direct contracting with private companies. Their clinics center on patients as customers, as opposed to the specialist -centered model of the big systems that drove U.S. health care into unsustainable hyperinflation.

Here’s a major piece of irony: the Affordable Care Act, aka Obamacare, was supposed to address the cost issues, but has worked to drive up premiums. It is employers and their entrepreneurial vendors for medical homes that are bending the curve for American health costs.

Disruptive innovation – if ever an industry needed disruption, it’s U.S. health care – is just getting started. Some big players are joining the revolution.
DaVita, the nationwide dialysis chain, bought the predecessor to Paladina. Humana bought the Concentra clinic chain. Walgreens runs clinics. Not all are holistic medical homes, but they are headed that direction.

Just recently, QuadMed and WalMart cut a deal to run a pilot that moves WalMart’s rudimentary clinics into a fuller range of services, headed by a PA or NP. Office visits are $40. If the pilot works, and WalMart puts its full muscle behind this new delivery model for primary care, look out.

The concept behind medical homes is sound. They allow employers to attack both sides of the health care equation – health and health costs. The contracted medical teams can home in on every employee with a chronic disease condition, the source of most costs. They are passionate about getting the disease conditions under control. Better and better predictive analytic tools help to identify those high-risk employes.

On the economic side, if expensive specialist care is needed, the teams can direct patients to the highest value providers for both quality and price. With price variations routinely of more than 300%, there are easy pickings for savings. New transparency tools highlight the best buys.
In short, the medical homes put employers back in charge of the medical supply chain.

The happy ending of this blog is that Washington County and some parts of Wisconsin are leaders in the medical home movement. We are early winners in terms of big savings.

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  • Tim Nixon

    John,
    Lots of good news. Thanks for providing it.