How Paychex is Finding Benefits Cost Savings with Data

Paychex and Artemis Health teamed up to tackle one common area of overspending for self-insured employers: avoidable emergency room visits. Read on to see: 

  • How Paychex used their benefits data to uncover the problem 
  • Methods for directing members to appropriate points of care 
  • The potential cost savings of telemedicine programs
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Paychex is a leading provider of integrated human capital management solutions for human resources, payroll, benefits, and insurance services. Paychex serves approximately 670,000 payroll clients as of May 31, 2019 across more than 100 locations in the U.S. and Europe, and pays one out of every 12 American private sector employees.

Many employers are facing rising benefits costs, but it’s not easy to find ways to save that still offer great coverage for employees and their families. In this case study, we’ll highlight the innovative way Paychex is addressing avoidable emergency room spending using their benefits data.

The problem.

The Paychex benefits team noticed they had an opportunity to save costs on emergency room claims, an opportunity that has existed for a number of years. They partnered with Artemis Health to look more closely at their benefits data, and they saw that avoidable emergency room claims accounted for a staggering $1.5 million in their spending in the first half of 2019.

Screenshot from the Artemis Platform showing ER spend metrics trending up.

Additionally, that number was trending up. Members were visiting the ER more often, in larger numbers for each analysis period, and the cost was rising both for Paychex and for their members.

The analysis.

The benefits team wanted to understand which conditions were being treated in the ER that could have been addressed at a more appropriate point of care, like an urgent care clinic, a primary care doctor’s offce, or even a telemedicine visit. They found members were using the ER for conditions like these:

  • Urinary tract infections
  • Headache
  • Cough
  • Low back pain
  • Nausea

While some conditions really do require emergency care, Artemis uses a unique data model to flag certain types of visits as “avoidable.”

Artemis Health calculates avoidable emergency room spending using the NYU Wagner study around emergency room utilization. The Artemis Platform automatically calculates the total cost that could have been saved if all claims had been handled at the correct point of care.

In order to get to a set of actionable tactics, Paychex wanted to understand more about their avoidable ER spending, so they also analyzed the utilization by office location. Here’s what they found.

Screenshot from the Artemis Platform indicating Avoidable ER Overspending by office location.

While Paychex’s Office Location 4 office boasts the highest number of enrolled members, it is not the primary hotspot for inappropriate ER utilization. In fact, you can see Office 1, Office 2, and Office 3 were also seeing high numbers of members visit the emergency room. This information gave the Paychex team the data they needed to take action.

The action.

Paychex is taking a data-driven approach to tackling their avoidable ER spending. They are targeting different groups of employees and different locations within the company based on what they learned using the Artemis Platform. Here are some actions they are considering:

  • More aggressively promoting their telemedicine program for everyone at Paychex to ensure members are aware of their options for immediate care
  • Sending targeted member education materials on appropriate ER visits through the health plan and telemedicine vendor to office locations with higher avoidable ER costs, and tailoring the messages based on the demographics and reasons for avoidable ER visits where the problem is identified
  • Conducting on-site benefits team educational visits to locations with higher ER utilization

However, these actions have been impacted by the COVID-19 pandemic. While it has boosted awareness and utilization of their telemedicine program, it’s also caused some members who needed immediate care to avoid the emergency room. The on-site educational visits are delayed, but Paychex’s benefits team hopes to continue teaching members how and when to use the ER vs. other available care options.

These cost-saving strategies aren’t just impactful for the business; Paychex is also empowering employees to make smart healthcare decisions, save the plan money, and save money on out of pocket costs as well. By tackling high ER utilization with targeted member education efforts, Paychex is incentivizing good healthcare decisions for employees and their families. It’s all part of their effort to get employees to get the right care, at the right time, at the right place, for the right cost.