Performance Management / HR

Part 4: What Can a Small Company Do To Reduce Its Health Care Costs?

This is Part 4 of a 4 part series by Stephen C Schimpff, MD covering the important topic of Healthcare in the US, that will be available each Friday in the month of June.

Patients need doctors that take time to listen. Employers need programs that reduce costs and ideally improve the health of their staff. These seemingly disparate needs can come together in a new model for effective primary healthcare. The key is to establish a primary care program that ensures the employee (and family members) get the time needed with the physician (or nurse practitioner or physician assistant) to get truly outstanding primary care. The need is enhanced primary care.

Health Care CostOne approach if for the company to establish a full service primary care clinic funded by the company at or very near to the employer’s site of business. Employees are welcome but not required to participate and do so at no cost. Some but not all employers make the clinics available to family members as well. Some of the key elements of a successful clinic are the following: Each individual is assigned a primary care physician (PCP) who is paid by salary, not fee-for-service. The PCP has no more than about 1000 employee/patients and so can give superb primary care (this number can rise or fall somewhat based on the demographic of the employees; a lower number if many have chronic illnesses or are older, for example). The PCP does a full initial evaluation and then sees the individual thereafter as often as necessary for as long as necessary, just as in a typical direct primary care practice. The expectation is that the patient and doctor will develop a long term trusting relationship. Individuals can schedule appointments often on the same or next day and there is extensive use of mobile technologies, an electronic medical record, telemedicine and other modern techniques. For those individuals with a chronic illness, the clinic nurses work with the PCP to coordinate care and the PCP communicates directly with any specialist before referring and after the visit.

The individual is the PCP’s patient; the medical record is not available to the company. The company is the source of funding and perhaps the space but is otherwise uninvolved.

The clinic manages wellness and preventive programs with health coaching and lifestyle behavior management. This might include but is not limited to nutrition counseling, fitness counseling, stress management and smoking cessation. It is thus an employer wellness program and a primary care program rolled into one. It is population health to the extent that the PCP and the team proactively interact with each participant rather than waiting for an employee/patient to call or visit with a problem.

Whatever the terminology, the most frequent underlying motivator for the company is to save company resources while tangentially improving health and wellness and providing quality care management. But that said, when done appropriately, it can and does have a very beneficial health effect for the individual (and family), saves the employee substantial money and offers better health all around. Definitely a triple win.

Critical to success – and that triple win – is a long term contract between the PCP and the employer that allows the physician the time needed for close listening, time for thinking, time for coordinating chronic care and time for quality preventive care. Trying to cut corners with high productivity, i.e., too many employee/patients per doctor, will only negate the opportunities for quality benefit and total cost reductions.

Some employers are turning to companies such as QuadMed or WeCare TLC to initiate these company sponsored clinics on a turnkey basis that can serve both requirements of improving employee (family) care while reducing the total health care burden of employer (and employee.). As QuadMed explains, it is a change for the employer “from being a purchaser of health insurance to an investor in employee health and productivity.”

Another employer approach is to pay the membership/retainer for employees that use a direct primary care practice or prefilling an HSA account with funds sufficient to do the same. This gets the employer out of the need to establish an ongoing primary care program and it allows the employee the privilege of choosing his or her own family PCP. But for this approach to be effective for your company it is an absolute requirement that you specify that the chosen PCP must have a reduced size patient panel of no more than 1000, preferably much less and that the PCP offers all of the enhancements noted above as an integral part of the practice. As with setting up your own in house clinic, this approach only works and is only worth your company money if it greatly reduces the doctor panel size.

Consider one of these enhanced primary care programs for your own company. It can mean much better care for your employees, less health care expenses thus driving lower insurance premiums for you and your employees, better health and with it lessened absenteeism and greater productivity. It’s a real winner.

 stephen schimpff book coverStephen C Schimpff, MD is a quasi-retired internist, professor of medicine and public policy, former CEO of the University of Maryland Medical Center, senior advisor to Sage Growth Partners and is the author of The Future of Health Care Delivery- Why It Must Change and How It Will Affect You

Category: Performance Management / HR

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About the Author: Stephen Schimpff

Stephen C Schimpff, MD is an internist, professor of medicine and public policy, former CEO of the University of Maryland Medical Center, chair of the Sanovas, Inc. advisory board, senior advisor at Sage Growth Partners and is the author of …

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