It was about seven years ago that a client of Matt McQuide approached the vice president at Benefit Controls Companies with a serious, if not uncommon, problem. The 1,000-employee textile firm was experiencing unsustainable rate increases of at least 9% to 11% a year. "They looked at us and said, 'If this continues, we won't have a business,'" McQuide recalls.

That's when McQuide decided to research installing an onsite health care clinic at the firm. He knew it would cost the employer around $200,000 a year. What he didn't know is whether the experiment would pay off. "They looked at me and said, 'Is it going to work?' and I said, 'I don't know if it's going to work. But I think it's the only shot we have of something working,'" says McQuide. "So we put it in, and they have just been unbelievable ever since. Claims lower, employees happy."

In fact, just one year later the employer reported employees would routinely tell him the clinic was the best benefit they received outside of their major medical plan. It's the same story for the 38% of McQuide's clients who now have their own employee clinics, and the 34% of colleague Rick Gantt's who do as well.

"I saw with my own eyes that it was working, not only just on the health plan side for costs, but people were making changes," says McQuide. "Then we really started evangelizing it; going around saying, 'This is the thing you need to do.'"

McQuide and Gantt, also a vice president, now make incorporating employee clinics into an employer's health care arsenal their primary focus at Benefit Controls, a national brokerage with offices in North Carolina, South Carolina, Kansas and Utah. Gantt works out of the Greenville, S.C., office and McQuide is based in Charlotte, N.C.


Growth market

Around 20%-27% of large employers - and even those with as few as 200 employees - are beginning to offer worksite health programs, according to Larry Boress, president and CEO of the Midwest Business Group on Health. As evidence of the growing popularity of workplace health clinics, MBGH in May launched the National Worksite Health Center Association in conjunction with health care consultancy The La Penna Group (see sidebar).

According to Boress, there are four main reasons why the clinics are continuing to gain employer interest. First is a matter of time management. Research shows that when an employee leaves the office for a medical appointment, they are typically gone for at least three hours - if they return at all, Boress says. Having an onsite clinic keeps employees away from the job an average of 20 minutes.

Second is compliance and engagement. While employers are spending millions of dollars on wellness programs and other health care activities, they only get around 15%-20% of employees to actively participate, Boress explains. By having an onsite clinic staffed with a qualified professional who can explain why employees need to take certain measures to improve their health, "employers can obtain the engagement they want."

The third reason is simply cost control. "Going outside the local medical community for tests and other services is very expensive," says Boress.

Although less tangible than cost savings, the final reason clinics are growing in popularity, says Boress, is the trust factor; "the value that it brings when you've got someone who you can trust who is local." Once employees know their information won't be used for performance evaluations, salary negotiations or the like, "there's a great comfort level, and people are more engaged."

The rising popularity can also be traced to health care reform, Boress adds. As an estimated one million more people gain health care coverage under the Patient Protection and Affordable Care Act, they will be looking for primary care services, which are sorely lacking in many communities across the country. "By having an onsite clinic involved ... you can ensure that your people will get the necessary preventive care," he says.

Gantt finds that the clinics create a culture of caring that truly manifests itself after about a year and a half. The result: "wonderful success stories" that come back to the CEO. "There's tears, and there's hugs, and there's caring, and it just grows from that," says Gantt. "It gets more participation, and it's a true win-win."


Structure and the larger picture

In these days of consumer-driven health plans and decreasing group benefits, McQuide says helping clients administer health clinics is "the only thing I've done in my career that actually lowered costs, and employees liked it. Everything is lower costs and 'we're squeezing you more.' This is lower costs and 'we're actually giving you something else.'"

Even so, plan designs do not stay neutral. Costs go down in the form of lower deductibles and copays for those who are active in the clinics and accompanying wellness programs. Those who are not active see their premiums and other costs rise.

Claudia Main, employee relations manager for the city of Hickory, N.C., has worked with McQuide for more than five years. The city always has employed an occupational health nurse, but after hearing from McQuide about the potential benefits of incorporating a general health clinic in-house, in 2006 the city established one for its 646 employees on the city health plan.

Based on the risk factors that are uncovered from a required health risk assessment, employees must then visit the onsite clinician a certain number of times a year. An outside clinic administrator keeps track of the program, and employees who are in compliance are rewarded with a more generous health plan.

Most of McQuide and Gantt's clients have clinics either onsite or very nearby. While the staffing ranges from facility to facility, most employ nurse practitioners. Although the clinics function completely outside of an insurance network, they have the ability to share health information with other providers.

Originally marketed to self-insured companies, both McQuide and Gantt say the clinics help fully insured employers save money as well. McQuide recently signed up a 350-life fully insured group. "They realized they were 100% experience-rated anyway, so even though claims don't go dollar-for-dollar, and they won't get the savings right away, it will take effect on renewal," he says.

Some clinics are operated by third-party clinic companies; others are partnerships with local physician practices. As for group demographics, participating employers range from computer software companies with an average employee age of 38 to manufacturing firms with an average age of 48, says Gantt.

Episodic care only makes up about 30% of clinic visits. Around 40%-50% of appointments are for disease management, and 20%-30% consist of care coordination for those in specialty care needing an adviser. The 15-20 minute appointment slots leave an ample amount of time for employees to visit and discuss questions and concerns with the practitioner, McQuide points out.

Of course having such dedicated staff on hand is beneficial, but without tying clinics into the employer's larger health care picture, it's just "having health care at a different location" and doesn't "optimize the situation," says Mike La Penna, principal of The La Penna Group and author of "Workplace Clinics and Employer Managed Healthcare: A Catalyst for Cost Savings and Improved Productivity." "Always think of it as an entrée into a program, not just a different site of care," he says.

Rhonda Lockhart, VP of HR at JM Smith Corporation, is full of praise for how Gantt has tied together the company's clinic and wellness programs. JM Smith's approximately 1,100 employees have access to four onsite clinics at the company's largest locations in South Carolina, Georgia and Arkansas.

When Lockhart first told Gantt they'd brought a nurse practitioner onsite in 2004, "he got giddy with excitement," she says.

Gantt took the reins by instituting a health risk assessment requirement for employees and ensuring the nurses were not only available for episodic care but also focused on wellness. True to Gantt and McQuide's observations with other groups, many JM Smith employees had not had a physical in memory. Blood draws revealed a large number of cases of high cholesterol and high blood pressure, Lockhart reports. "You would not believe how many things we have caught early because of just the health risk assessment," she says.

Gantt serves as the main contact with the nurse practitioners in his role as manager of JM Smith's disease management program. He is also in charge of claims data mining. After an analysis, he'll come to Lockhart with the most pressing areas that need work and ideas for how to adjust employee incentives appropriately.

McQuide plays a similar role with the city of Hickory. This is the first year employees are subject to a nicotine surcharge, and McQuide was heavily involved with researching it. "He's a great researcher," says Main, adding that with McQuide's guidance the city's claims have gone down, costs remain mostly stable and there are no plans to increase employee premiums.


The right fit

For programs to be successful, it's imperative to stay engaged and actively watch employee data, says Gantt. It was a daunting task with the first few clinics, but now he and McQuide have developed metrics to accurately track the success of programs. "You just have to, because you have to tell Mr. CFO what's working and 'this is why' and 'this is how,'" says Gantt.

MBGH's Boress believes working with a consultant or broker to run onsite clinics is "incredibly valuable" for employers because of the level of knowledge and experience they bring to the table - not to mention the fact that brokers know firsthand that since each company has its own circumstances, a cookie-cutter approach will not work.

There's plenty of room for innovation in the field, and La Penna believes those who are focused on population health management can succeed by positioning themselves as an integral part of direct patient care. "[Brokers] have got the capability to analyze the claims file and do a lot with the client firm to identify opportunities within their own population for reducing cost," he says.

At JM Smith Corporation, Lockhart reports that costs have remained stable at around 3%-4% a year - a figure that could easily have skyrocketed had the preventive screening program tied to the employee clinic not caught precancerous cells in several employees in recent years.

McQuide thinks back to how meetings with clients used to go and marvels at how much things have changed with the implementation of onsite clinics. "When you talk about affecting your health claims, that's so much larger than the rest of it," he says. "Obviously we work hard to get the lowest reinsurance and the rest of it, but in the meeting that could be 15 minutes.'"

Additionally, traditional benefit levels tend to remain stable or even improve after clinics are implemented. Without having to worry about those areas, Gantt and McQuide are then free to spend more time discussing the data trend and how to improve things for the following plan year.


New delivery

Confident with the success of the onsite clinics, McQuide says it's his business model now to seek out clients that will fit well with the structure. As a result, 95% of new clients want to implement a clinic program for their employees.

Gantt and McQuide operate under two different companies. If they are providing traditional brokerage services for a client through Benefit Controls, they don't typically profit from a clinic, but for stand-alone wellness consulting through Team Believe Achieve, they charge a fee.

"Our entire delivery is different. Our whole philosophy on the game is different. It's about improving the quality of life, which yields great things," says Gantt. "But to do that is hard. It makes our job harder. Because just to sell reinsurance and do network studies, that's pretty simple - traditional brokerage services. But the broker of the future, to be successful, has to be a partner in reducing health care costs and making an employer's bottom line look better."

If the job is done right, client costs remain stable. Between the two of them, 12 clients are members of the Benefit Controls Flat Liner Club for those that haven't paid more for health care since as long ago as 2003. Gantt expects that number to be more than 20 in the next 18 months. "If you can deliver that kind of result it's hard to get fired unless you just make a mistake," he says. -E.G.

Introducing National Worksite Health Center Association

For the last couple of years, the Midwest Business Group on Health has organized roundtables for around 110 self-funded employers to discuss onsite health clinics. The popularity of the group meetings led Larry Boress, MBGH president, to look into creating an association for the growing number of interested employers to have a place to discuss best practices, growth potential and a realistic view of how to determine a return on investment from the clinics.

At the same time, health care consultancy The La Penna Group also found through employer roundtables, as well as a website and newsletter on the topic, that employers were interested in creating an association. In May, the organizations partnered to form the National Worksite Health Center Association.

"Primarily the employers want a trusted place to exchange information that's not really organized in a commercial fashion," explains Mike La Penna, principal of The La Penna Group and author of "Workplace Clinics and Employer Managed Healthcare: A Catalyst for Cost Savings and Improved Productivity."

The nonprofit organization plans to eventually include the vendor community, but will first give employers with clinic experience the chance to set the agenda for how the organization will function, according to La Penna.

In addition to a "very select" board of employers, the association will also feature a medical director council consisting of directors from several onsite programs around the country.

"This new national association will increase the exchange of information and experiences between employer sponsors of worksite health facilities," says Boress. "NWHCA will also provide practical and objective information for those examining this approach as to how these facilities can be part of a total health care strategy that increases productivity, reduces costs and enhances engagement in health management programs."

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