February 6, 2010

FAQ’s

Employer Managed Health Care and On-Site Clinics

The basic premise behind Employer Managed Health (on-site) is that an employer is the ultimate determinant of the health care status of its employees and dependents and that the employer can address the health care status of its workforce through a combination of benefit design, direct contracting, preventive measures, and a proactive partnership with the employees to promote general wellness. Firms who have elected this approach have demonstrated significant improvement in cost control and in employee satisfaction.

What are the basic components of Employer Managed Health?

Generally, the program is an intelligent and thoughtful mix of several factors: 

  • On-site medical services including primary care.
  • A robust primary care service component.
  • Coordination of all occ-med, comp, industrial health, and basic primary care.
  • Routine claims analysis and focus on disease management and disease risk factor control.
  • Direct contracting for inpatient and specialty services with a local health care system that “gets it” and is willing to trade significant discounts for volume.
  • Narrow channel network development for specialty care.
  • Reorganization of benefits structures to promote wellness, beneficiary compliance, and selection of the appropriate network services.
  • Direct management of care coordination and utilization oversight functions.
  • Coordinated medical record functions that allow recall and compliance monitoring.
  • Articulation with an employee accessed health record, generally web-based.
  • A structured wellness and preventive program.
  • Feedback loops built in to allow continual quality improvement techniques to be applied to the health benefit expenditure.
  • Employee involvement and interactive processes to assure solid communications about program features and to create a learning environment concerning health and the health benefit structure.

Where does this type of a plan work?  

Most features can work in any environment, but the entire package generally requires a firm with self-funded benefit programs, a localized work force, and some ability to coordinate on-site information, primary care, and wellness services. However, this approach is very scalable, and it can be applied in almost any employer location.  

Does the presence of a union prevent this type of approach?

No. Some very successful programs have been implemented with the direct involvement of union leadership, and this type of an approach can fit in an environment with organized labor.

What if we have contractual obligations with different classes of employees?

This still can be an option for some of the classes of the work force, and it can also be set up so that certain features are available to each class in formats that would emulate the standard health care offerings in any community.

Where do the cost savings originate?

Cost savings are derived from several areas. Short term, the program cuts out any “middle vendors” and re-packagers of health care services; the narrow channel contracting can achieve significant savings; on-site primary care can be a factor in savings over standard doctor offices; and on-site services reduce loss-of-time costs. Pharmacy, lab, and physical therapy can all be quantified. Long term, healthier workers use less health care and rehab functions improve with more control over the admission/discharge process.

Are the cost savings assured? Can they be predicted?

The cost savings can be predicted, especially those in the near term. The process requires an analysis of the employee base claim history and the development of a projection (or pro forma) of an on-site primary care program coupled with initial negotiations with local secondary providers to gauge potential discounting. Longer-term savings depend upon the composition of the work force and the effectiveness of the preventive programming. Current literature suggests significant long-term positive effects on certain wellness and preventive initiatives, although most firms do not use these costs to justify changes in programming.

What is the risk? Is there any downside?

Risks are similar for any program that promotes core change – there can be political resistance from existing stakeholders in the health care system and even internally to the firm. The employee benefit change function requires significant benefit redesign and only works if there is communication and trust developed between the firm and its work force. The program’s success depends upon the employee election of program components and use of the network services designed to control costs. All of these costs and risks can be quantified and modeled in a predictive fashion. The program is not easily reversible, and there is a capital cost and allocation of on-site space. This is generally justified by an ROI (return on investment) analysis that relates near term savings (those with a high confidence level) to the capital and start-up investment.

Why the on-site clinic? Can this be done without having on-site medical care?

This creates presence and awareness and access for the program. It captures a significant amount of the primary care, and it focuses employees (and their dependents) on the preferred network of secondary services. If there is no primary care component access point on site, there should be a locally identified site (or sites) where co-pays and access services are designed to assure compliance. Primary care management is critical to program success.

What about legal risk and liability?

This is manageable through insurance and appropriate corporate risk management processes. This is not a concern to firms who have implemented the program successfully.

We have a lot of cost savings activities now. Do we undo them? Won’t we lose any gains we have made?

Keep them in place. An on-site program complements these efforts and can generally improve upon them. This is a program that, if done correctly, fosters additional usage of existing programs and overlays them with an EMR (electronic medical record) and other features which coordinate programs of this kind more effectively. Eventually, they will all complement each other and the on-site staff will re-evaluate them for effectiveness.

Isn’t there a danger of employee backlash against the “company doctor” concept?

This issue is very manageable in the proper context, again as proven by firms who have successfully implemented these programs. It is all in the perception of the value of the program and, in many cases, this type of corporate oversight of the health care system’s effects on an employee and beneficiary base significantly improves their access to services.

We were going to go to more consumer choice and a health savings component. Isn’t this going to be a problem?

No. There is not enough information for consumer choice in any real sense of the word. The on-site staff will accommodate the consumer savings process and provide a ready base of knowledge for other decisions. This program actually enhances the consumer components since the employer (and the people running the on-site programming) take direct charge of processing information and assisting the employees in making these important choices.

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Comments

  • OnSite Clinics Editor

    March 6, 2013 at 9:05 am

    I’m sorry, we don’t have any links for job opportunities, but this is a great idea. I would recommend that you contact the vendors or others listed on our site – most of their contact information is given. Good luck!

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