July 11, 2017

On-Site Clinics: How Employers Are Changing Healthcare

Artemis recently explored some trends around employer-provided telemedicine benefits, which allow employees to make a quick phone call instead of leaving work to wait at a physician’s office or urgent care center. Convenient? Yes. Less expensive? No doubt. Effective? Sometimes. Without an in-person exam or lab work, telemedicine doctors can get it wrong, resulting in multiple calls or a subsequent visit to your trusted primary care doctor.

But what if employees could see a doctor or nurse just down the hall or in the next building over? They could access in-person care, lab tests, physical therapy, mental health services, and more. All the convenience of telemedicine without the challenges of video chats.

Modern Healthcare tells the story of a large manufacturing company, Laitram Machinery in Louisiana, and how they're facing the problem of employee health:

“‘In New Orleans, you can find ways to not eat well and not drink well,” said Franck LaBiche, the company's human resources director. “We were looking at a monthly healthcare premium curve for employees that showed a 40% increase over six years,” said LaBiche, whose company has a self-insured health plan. In 2012, Laitram joined a growing list of large U.S. employers that have opened on-site health clinics in an effort to control the rising costs of their health benefit programs.”

These exponentially growing costs, coupled with a desire to improve employee health, are inspiring many employers to explore the possibility of bringing healthcare facilities and professionals to the office through on-site clinics.

Nearly 30% of companies with over 5000 employees now offer on-site health clinics to treat minor injuries, diagnose everyday illnesses, offer fitness and nutrition coaching, and even see employee’s covered family members. Most employers will contract with an on-site clinic vendor, though some will elect to go the “a la carte” route, hiring and managing clinical staff directly.

Artemis clients often seek out on-site clinic options as a way of providing high-quality care. Instead of focusing on the convenience and cost savings, they seek out medical teams and partners who focus on patient outcomes. In fact, Fortune’s annual 100 Best Companies to Work For list includes 40 employers who include on-site health clinics in their benefits packages.

Some employees will see an on-site clinic as a convenient perk, while others may have privacy concerns. On-site clinics providing anything beyond basic first aid are subject to ERISA compliance and regulations. There are tax implications, HIPAA requirements for medical providers, COBRA regulations, and more. This piece from the International Society of Certified Employee Benefits Specialists provides a quick overview of some considerations employers use to determine whether an on-site clinic will work for their population and business needs.

And then we get to the ROI - how do you know if an on-site clinic will be worth the cost, risk, and compliance? Will it save costs? Will it improve patient outcomes? Will employees actually use it? Artemis has conducted several analyses for our clients to answer this question. For one large employer with offices all across the country, we explored specific medical costs for employees and spouses to get a sense for the base cost of care in this region:

Then we broke it down into costs that would be covered by on-site clinic visits instead of traditional visits:

We get a great sense of how an on-site clinic would impact care for these members:

  • Nearly $300,000 of our $390,821 in claims comes from office visits, which could be handled in an on-site clinic
  • Office visits alone account for 3,188 out of 4,830 in total medical claims for employees in this area
  • Approximately 78 employees could benefit from on-site behavioral health visits, while 41 could conduct physical therapy appointments in a convenient on-site clinic

Armed with this information, the client is able to accurately assess how an on-site clinic would impact costs, employee behavior, and their bottom line.

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