Worksite Clinics: Comprehensive Management of Employee Health and Cost

1. Worksite Clinics: Comprehensive Management of Employee Health and Cost Brian Klepper November 12, 2007 Daytona Shores

2. This presentation is, in part, about our need for health care change, and why its a lot more likely to happen here: And here: Than here: The Unrelenting Crisis

3. Source: IBI Full Cost Benchmarking Study - 2002 Benefits Data • The real cost of poor employee/family health is in lost productivity from: • Absenteeism • Presenteeism • Disability • Workers’ Comp • Turnover The Dilemma: Benefits or Productivity

4. Reno’s Employers Are Apoplectic Over HC Cost • Employers only. No HC folks. • Only CEOs, CFOs, COOs. • Objective: Pool and mine claims data to identify problems and opportunities. Address them. • They agreed in 1.25 hours of a 2.5 hour meeting. • Employers are tired of haggling over HC. They want results right now. They don’t understand why the HC industry isn’t cooperative. They’re now taking action on their own. Employers Are Tired OF HC

5. 2.1x As Fast As Business Earnings Growth • 4.1x As Fast As Workers Earnings • 4.8x As Fast As General Inflation Premium Growth

6. $14,500 - Total employer-sponsored health care costs for a family of four in 2007. (Milliman) $19,300/yr or less - 1/4 of US workers’ income $36,000/year or less - 1/3 of families’ income (US Census) It’s Very Difficult To Make This Work HC Cost & Workers’ Earnings

7. 2004 - Earnings/EE Compared To Avg Health Care Costs/EE of $6,227 (Hewitt) Here’s The Retailer’s Perspective HC Cost & Production

8. “If [Medicare and Medicaid’s] costs continue growing at the same rate over the next four decades [as they have over the last four decades, at 2.5%/year higher than per capita GDP], federal spending on those two programs alone would rise from 4.5% of GDP today to about 20% by 2050. That amount would represent roughly the same share of the economy as the entire federal budget does today.” Peter Orszag, Director, CBO Testimony to the Senate Committee on the Budget, 6/21/07 HC Inflation

9. Health Care Plz Keep Lid On Pricing & Performance Data!! The Deepest Driver Of The Crisis Lack of Consensus and Infrastructure for Data Sharing, Standards & Transparency Can’t see problems in the system Has cultivated an opportunistic culture. Why Cost & Poor Quality

10. A Century Later And We’re Still Waiting! 1920 Dr. Ernest Codman proposes the “end result system of hospital standardization” “Hospitals [and surgeons], if they wish to be sure of improvement...must analyze their results, to find their strong and weak points, [and] must compare their results with those of [their peers]...[They should] make this information publicly known so that the future patients might make informed decisions.”

11. Medicare Per Capita Spending By Hospital Referral Region, 2003 Perhaps the most significant hallmark of the crisis is our inability to provide consistent care that adheres to the evidence and is independent of financial conflict. Source: Dartmouth Atlas Project, The Dartmouth Atlas of Health Care Practice Variation

12. Source: Jerry Reeves MD, Culinary Fund Heatlh Plan, 2005 Practice Variation

14. Insanity: doing the same thing over and over again and expecting different results. Albert Einstein Self-Insurance Reduced Coverage Higher Co-Pays Better Networks Mailing Brochures for Patient Education Telephonic Patient Mgmt A Different Approach

15. Worksite Clinics Comprehensive Physician-Directed Preventive/Primary/ Urgent/Walk-In For Employees & Dependents A Platform To Manage Downstream Care Clinic As Platform

16. Program Savings Areas Health Plan Occupational Medicine Workers Comp Disability (STD and LTD) FMLA, ADA Pre-Employment Screening Fitness for Duty Productivity Clinic As Platform

17. The Clinic is Separate From And In Front Of The Health Plan Patients Don’t Use The Plan Until They Leave The Clinic. Health Plan So It Can Be Implemented At Any Time and Does Not Require Plan Changes. Clinic As Platform

18. Employees may Wish to keep their primary care doctor. Wish to access care away from the employer setting. This is completely acceptable. Normal health plan deductibles and co-pays apply. The Clinic Is NOT Mandatory For Employees/Dependents Clinic As Platform

19. Feasibility Criteria Employer self-insured for health coverage. Minimum of 100 employees on site. Clinic As Platform

20. The Basics Total Costs - $50-$60 per month per employee. Three year contract. Pass-through build-out & operational costs plus management fee. Invest in clinic; ROI in claims. Highly transparent. Continual performance feedback. Extremely convenient and employee friendly. No co-pay or drug costs. Extended hours for dependants. Easy employee opt-out if desired. Clinic As Platform

21. What We’ve Learned Most health industry professionals have a financial stake in promoting higher costs. Care is highly variable within and across markets. Half of all care/cost is unnecessary or inappropriate. Convenient, open access to care reduces the need for downstream services. Primary care, health care’s entry point, provides the best platform to manage full continuum care/cost. Chronic disease is responsible for more than half of cost, and can be reduced significantly with lifestyle counseling and management. Data can be analyzed to identify physicians and hospital services that routinely get the best outcomes at the lowest cost. Given tools, patients respond to incentives to manage their health. Managing Differently

22. Changes to Primary Care and the Drug Formulary pay for the clinic. Other services enhance the savings. Typically, Before Clinic: Primary Care = 22% of costs Drugs = 18% of cost Each drops by 50% = 20% of cost How The Clinic At Least Pays For Itself Managing Differently

23. Data Analysis/Network Refinement* Each is proven to reduce risk and cost. (Onsite) Chronic/Acute Care Management* Drug Dispensary Primary Care Management Open Access Management Tools/Approaches How It Works

24. All doctors use Electronic Medical Records and follow Best Practice Guidelines, for better, more consistent care/outcomes. Patients make appointments by calling, through the Web-based scheduler, or by walking in. Better access and convenience and prevents conditions (and costs) from becoming worse than they should be. Clinic doctors replace a primary care network where the care, referral patterns, and tools are often inconsistent and outdated. Doctors don’t profit from care services. They have no incentives to over-utilize. Patients pay nothing for clinic visits or for drugs prescribed through the clinic. How It Works

25. A refined, high performance “downstream” network is more efficient and further reduces costs. Analyzing claims data and having all enrollees take a Health Risk Assessment helps us identify health issues and chronic diseases that should be managed. Claims data also let us identify the specialists and inpatient services that consistently get the best outcomes at the lowest costs. Nurses manage patients with chronic diseases and with complex acute conditions. How It Works

26. Works With • Existing Programs • Open Enrollment • HR • Risk Management • Occ Med Integrates With Existing Programs

27. Pricing/Performance Transparency Provides Monthly Group Transaction Reports and, With Access To Complete Health Plan Data, Routine Performance Reports. HOWEVER - Data Is Crucial For Accountability and Mgmt!

28. It Is In Patient’s AND Employer’s Interests That Identified Patient Information RemainInaccessible To The Employer. So Is Privacy & HIPAA Compliance

29. Employer 1 After 2 years, total health plan costs were $430,000 per year lower than expected because of the clinic. Case Studies

30. 2005 Project Initiation $6,181.08/year. End of Year One$4,088.64/year. End of Q1 2007$3,392.52/year. This is a 45% reduction over 15 months!** **Case Study reference available on request. Employer 2222 employees (plus dependents) Case Studies

31. Employee Orientation • Initially and Annually • To Help Employees Understand Clinic Rules and Uses • Conducted by WeCare Senior Clinical Staff Getting Employees Comfortable

32. Brian Klepper, PhD 904.246.9643o, 904.343.2921c bklepper@gmail.com www.wecaretlc.com www.brianklepper.net The Health Care Blog www.thehealthcareblog.com Health Policy and Market Review healthpolicyandmarket.blogspot.com The Doctor Weighs In www.thedoctorweighsin.com