Providing on-site and near-site health services for large employers fed up with rising health insurance premiums presents a golden growth opportunity for some health systems.
A small health system in Wisconsin is seeking to have a big impact in the market for on-site medical clinics at large employers.
"We think more health systems should get in this business," says Randy Van Straten, vice president of business health at Green Bay-based Bellin Health System, which features an acute-care hospital, a critical access hospital, and 31 primary care clinics. "We host health systems about every other week who want to learn from us."
In the early 2000s, a harsh reality turned into a dream opportunity for Bellin, Van Straten says. The health system was facing a 30% increase in premium costs for its employee health insurance. "What we found out was that we really didn't know our employees," he says.
Bellin, which employs 3,650 people, examined the health of its workforce and launched an aggressive effort to improve their medical status.
The results are eye-popping. Bellin has saved about $23 million in employee-healthcare costs over the past 12 years.
The number of employees at risk for one or more serious medical conditions has dropped from 14.2% to 6.6%. From 2014 to 2015, Bellin was able to decrease its per-employee healthcare costs 1%. "Who has a decrease these days?" Van Straten asks rhetorically.
When Bellin's executive team starting reporting the population-health gains among its employees, the health system's board of directors, which includes leaders from several Green Bay-area large employers, were more than impressed. "We got pulled into this business by our own board," Van Straten says.
Bellin now provides a range of on-site services to 125 companies, including an on-site clinic at the home of the National Football League's Green Bay Packers, Lambeau Field. The Packers, who offer access to their clinic for all of the team's workers, have a seat on Bellin's board.
In addition to on-site health clinics, Bellin offers on-site occupational health services, a turn-key corporate health and wellness program, fitness centers, and at-risk strategic partnerships that feature health clinics based on pay-for-performance and shared savings models.
The health system has assembled a portfolio of 20 strategic partners and annual revenue growth from strategic partnerships is exceeding Bellin's 10% goal, posting gains from 12% to 18% in recent years, Van Straten says.
Convenience for Workers and Productivity Gains for Employers
Large employers are making big bets on on-site health clinics, says Karen Marlo, vice president of benchmarking and analysis at the Washington, DC-based National Business Group on Health.
On-site clinics align convenience for workers with productivity gains for employers, she says. "In certain areas of the country, having on-site clinics is a major time-saver."
In survey results from 107 large employers that NGBH published last year, 60% of businesses reported offering an on-site health clinic to at least a portion of their workforces. The 2015 EMPAQ Insights survey—which polled large employers in eight sectors including healthcare, post-secondary education, retail and manufacturing—found dramatic attendance gains for businesses with on-site clinics. Workers at employers that offered access to on-site health clinics for all of their employees missed an average of less than five days on the job annually. Workers at employers that offered no on-site health clinics or other on-site access to health services for their employees missed an average of more than 20 days on the job annually.
On-site physical therapy is a particularly great fit for workers and employers, Marlo says. Because physical therapy regimens often call for three sessions per week, and off-site PT services are a significant inconvenience for employees and costly financial hit for employers, they can result in a "huge loss of productivity."
The manufacturing sector, which has faced safety challenges since the Industrial Revolution, and other large employers have been operating on-site health clinics for decades, Marlo says. "On-site clinics have been around for a long time, but now they are being leveraged to provide more services."
The EMPAQ Insights survey results reflect the occupational-health roots of the more robust on-site clinics that Bellin and other health systems are operating with large employers. Manufacturers are the most likely to offer an on-site health clinic to their workers, at 86%. Financial services and insurance firms are the least likely to offer an on-site health clinic, at 29%.
"In recent years, innovative employers have looked to redesign on-site clinics, transforming them from occupational health clinics to health centers that treat both the acute and chronic medical needs of employees," the EMPAQ Insights report states.
Free Preventive Care Nets Savings
Bellin's strategy for offering on-site health services is grounded on generating results for employers and using that track record to attract new clients, Van Straten says. "You don't want to grow your business on the backs of employers. You want to generate results for them. We don't want to do more healthcare for them; we want to do better healthcare for them."
Other health systems that want to offer on-site medical services to large employers should follow Bellin's lead and start with generating healthcare coverage value for their own workforce, he says. "They should really focus on their own employees… It's hard to tell an employer, 'we're going to help you control your costs,' when you can't control your own costs."
Bellin's medical benefit costs for its employees are at least 10% below the sector average, he says.
An effective cost-containment strategy at Bellin has been offering free services such as preventive care for a half-dozen medical and behavioral health conditions, including diabetes, tobacco addiction, and cardiovascular disease. The free services program has netted significant reductions in the number of claims for care more than $50,000 because it has reduced access barriers for high-risk employees with chronic diseases, Van Straten says.
"They don't want to come in because of the costs… We've been able to reduce our large-claim spend. They're at a lower cost because we're catching things earlier."
Offering on-site health services to large employers requires investments in the service line, he says. "We also have an employer customer to deal with."
Bellin has five account executives and three sales executives to generate and maintain large-employer clients for on-site health services. The account executives are deployed based on business-mix segments of the local market, and the sales executives are deployed based on regions and types of on-site services. "I call it the get-and-keep strategy. There are sales incentives. If you're going to do this and do this well, you have to have a sales team," Van Straten says.
Primary care growth is a key metric that Bellin is monitoring to gauge the financial performance of its on-site health service business. In recent years, Bellin has boosted its primary care patient population at annual rates of more than 10%, he says. Health-risk appraisals at large employer on-site clinics are a top growth driver. "It's our portal to build primary care relationships."
Christopher Cheney is the CMO editor at HealthLeaders.