There is a stampede in the private sector toward work-site clinics. More than one-quarter of the 1000 largest companies in the country have installed their own medical teams to deliver primary care on-site. And public payers are starting to move in that direction, too.
Why? Because they work to improve workforce health and to dramatically cut costs. It’s win-win.
Among the potential early movers on this reform is the West Bend School District, whose board will be deciding on whether to go that way.
I’ve spent some time researching this subject for a chapter in a book I’m writing on health care reform in the private sector, and Serigraph has been a test site for such a clinic for almost a decade. So I wrote a memo to the district’s board members outlining the benefits from on-site health care. Here’s the memo verbatim:
Memo to: West Bend School Board
Memo from: John Torinus, chairman, Serigraph Inc.
Subject: Savings from Work-site Clinics
Serigraph has utilized an on-site health care clinic since 2004 and it has contributed greatly a reduction in our health costs. We started with a chiropractor and nurse practitioner and have since added a dietician, nurse coach and two retainer doctors. All medical services are free to our co-workers.
Our health costs at Serigraph run about 40% below the national average. We have deployed a number of innovative approaches to the delivery of health care, as has your district. But we believe the on-site clinic has been one of the major drivers of our positive results.
Generally, employers that have taken over primary care have seen savings of 20% to 30% from their previous bills. QuadGraphics has two decades of experience with work-site clinics, and that level of savings has been their audited experience.
Here are the sources of the savings from on-site care.
* The on-site primary care takes the place of visits to more expensive primary care doctors and specialists in the big hospital systems.
* The on-site team helps patients to order appropriate care, which brings the elimination of unnecessary tests and specialist appointments. Some of the tests can be done on-site.
*The on-site team steers employees to the best values (quality and price) for more complicated care and tests. (We pay $525 for MRIs, for instance, instead of several thousand dollars at are clinics and hospitals.
* The on-site team can accomplish serious management of chronic diseases, such as diabetes, hypertension, asthma, obesity and depression. Those chronic diseases are the source of 80% of national health care costs. If they are not managed, it is hard to contain costs. Serigraph believes it has 90% of its diabetics under control vs. one-third nationally.
* The on-site team can prescribe drugs and always starts with generics.
* The convenience of the on-site clinic means people access primary care more often. That means they catch problems earlier at less cost.
* Prevention and wellness can be offered free at the on-site clinic, again heading off more serious conditions.
* Workers’ compensation costs drop as employees use the clinic for treatment vs. going to a clinic or hospital at state-mandated sticker prices. Moreover, people get back to work more quickly.
*The on-site clinic can deliver annual health risk assessments for employees and spouses. Invariably, that process reveals several high risk people who need immediate intervention. Again, early intervention is better than waiting for an emergency.
* Employees lose less time going to and from appointments.
* As workforce health improves, productivity rises and absenteeism drops.
* Employees see an on-site clinic as an investment in the health of their families. That improves morale and helps with recruitment and retention. Expensive turnover costs are reduced.
An on-site clinic can be an integral part of an organizational strategy to keep people healthy and out of the hospital. It is a virtuous circle: better health, lower health costs. Serigraph has cut its hospitalizations by about half, from the national average of 71 per thousand lives in 2007 to about 40 today.
The costs of establishing a clinic come back to an organization very quickly.