Employers partner with worksite health centers for a variety of key benefits, such as increasing access to high-quality primary care and behavioral health services, offering an in-demand perk to attract and retain top talent, and ultimately lowering year-over-year healthcare costs.
Providing employer-sponsored health services — whether that’s through an onsite health center at the worksite, joining an existing network of centers around town or through virtual visits — requires considerable planning for any organization. Besides the logistical aspects of launching a health center and hiring providers, medical assistants and other staff, employers need to manage the implementation, communicate the services and drive employee engagement.
There’s also a significant financial commitment. Any organization that invests in providing advanced primary care and wellness services needs to understand their return on investment (ROI), the key drivers that impact ROI, and how long it takes to see a positive impact on population health — and their bottom line.
What are the Key Drivers of Employee Health Center ROI?
Opening a dedicated health center might seem like a magic-bullet solution for lowering healthcare costs, but the path to generating a positive ROI requires meaningful engagement with health plan members and clinic services, says Chad Ashcraft, Marathon Health’s Executive Vice President of Growth.
Ashcraft suggests employers need to focus on providing value through ease of accessibility and keeping employees engaged, high-quality care and positive health outcomes.
Ease of Access: People typically avoid seeking healthcare if they have to wait for weeks just to schedule an appointment, or take off work to drive across town and spend hours in the waiting room to only see a provider for a couple of minutes. It’s a hassle to say the least, and it creates an unnecessary barrier to entry.
Marathon Health’s model of patient-centered care focuses on making it as easy as possible for members and their families to engage with health center services, and in a variety of convenient ways. Members can often schedule same or next-day appointments, visit multiple health center locations and spend minimal time filling out paperwork.
“You have to give them great access with easy access points, whether it’s virtual or in-person, whether it’s one center or multiple centers,” Ashcraft says. “The key is engaging as many people as possible.”
Proactive Patient Engagement: Determining the right way to drive health center usage leads to higher engagement and a faster ROI. There are four controllable levers that drive incremental engagement: care teams, leadership support, marketing access and incentives. “Organizations that offered our good-better-best incentive program to their employees in 2020 saw a 37% lift in health center engagement compared to employers who did not offer an incentive program,” says Jenny Lowry, who leads incentive design for Marathon Health. “That’s huge for two reasons. First, more people prioritized their health & wellness and took the important step of engaging with our providers. Second, employers who participate in our incentive program also see a 2:1 ROI on their spend.”
Lowry says HSA contributions or premium reductions of $1,000 drive the biggest lift in engagement, but if that’s too rich for your budget, the next-best award is $250 to $500. “When we looked at the last several years of data, we actually saw a diminishing return for the $501 to $999 bucket,” she says.
Due to busy schedules, people often put off scheduling annual physicals or biometric screenings, which can uncover a range of chronic health conditions. Incentive programs give members an extra nudge and reward them for making healthy choices.
More importantly, incentive programs often establish a first touchpoint for new members, which helps to create engaged, repeat members.
“When looking at a cohort analysis of engaged members versus those who’ve never used the health center services or are consuming care elsewhere in the open market, you typically see a 30% to 35% difference in costs,” Ashcraft says.
Culture of Exceptional Care: After removing the barriers to care, Ashcraft stresses the importance of providing a fantastic patient experience.
“Once they engage, you give them an exceptional experience,” Ashcraft says. “That’s what gets members to come back and utilize the services more.”
Many employer-sponsored health centers practice an advanced primary care model, which focuses on providing comprehensive care to treat the whole person, taking into account their physical, emotional, psychological and spiritual well-being. Providers spend quality time with each member, while offering a variety of core services, including routine lab testing, no-cost medications, health coaching and behavioral health services.
“You need care teams who build lasting relationships with their patients,” Ashcraft says. “Compare the 30-minute appointments with us to the six minutes they’d spend in a hospital or urgent care setting. You simply can’t treat diabetes or figure out why a patient is depressed in six minutes. That type of turnstile medicine has produced sicker, more frustrated patients and unfulfilled providers.”
Once a member experiences superior care, they’ll be more likely to recommend services to covered family members and coworkers, boosting future engagement.
“The relationships we see are life changing,” Ashcraft adds. “Patients notice the personalized approach, and often remark how they truly feel listened to and heard. It directly makes a difference in the outcomes.”
To date, Marathon Health enjoys a 98% positive approval rating from health plan members and a world-class NPS score of 87, a testament to its patient-centered care model.
Healthy Outcomes: In addition to increasing access and offering a high-quality patient experience, Ashcraft says employers need to take a population health-focused approach to identify and target high-risk and emerging-risk members. This could include analyzing data to identify member cohorts, such as patients with unmanaged diabetes or high blood pressure, and connecting them with medications, health coaching and other services to improve health outcomes.
For example, according to the Centers for Disease Control and Prevention (CDC), people diagnosed with diabetes incur on average $16,750 annually in medical expenses, about 2.3 times the medical expenses of a person without diabetes. Additionally, 1 in 3 U.S. adults has prediabetes, and 90% don’t know they’re at risk. Actively engaging these member groups with advanced primary care not only improves population health, it saves employers considerable money on healthcare costs.
In a recent analysis of 3,000 identified pre-diabetics who had access to Marathon Health, 47% reversed into optimal range after their engagement with our providers. That improvement led to savings of $562 per member per year.
“You have to give them access, you have to give them a great experience and you have to focus on outcomes,” Ashcraft says. “If you don’t execute these three steps well, or do any one of the three poorly, it’s hard to see the ROI.”
How Long Does it Take to See a Positive ROI for Employee Health and Wellness Programs?
Ashcraft says Marathon clients who actively engage their employees and promote clinic services see a faster ROI, and often break even in the first year, with the average company taking about 18 months to break even.
“Ideally for any client, we show them a path to get to break-even on ROI in year one, so if they spend a million dollars with us, we show them how they can get a million dollars of savings from the population.”
Those savings, Ashcraft says, come in the form of diverting members from costly health services, such as avoidable ER visits and expensive lab tests from outside facilities, moving members from brand name to generic medications, and empowering members to better manage their chronic conditions and other high-risk behaviors.
“Typically, the magic number to break even in year one is about 35% to 45% employee engagement,” Ashcraft says
What’s a Good ROI for an Employer-Sponsored Health Center?
With an average breakeven time of 18 months, employers truly begin to discover savings the longer they use the services.
“Even the clients who take 18 months to see a positive ROI, it really shoots up after that,” Ashcraft says. “By about year three, they’re saving $3 to $5 for every $1 invested — and they’re seeing it every year.”
Ashcraft says Marathon Health clients saved an average of $2.70 for every $1 invested in employee healthcare in 2020, with the average company saving around $11 million across their book of business.
Health Center ROI Begins with Employers
Providing employees with convenient access to high-quality, patient-centered primary care is increasingly becoming a go-to benefit for many employers.
To truly get the most out of the investment — from health outcomes to financial savings — employers need to take an active role to ensure employees understand available services, while making it seamless to receive the care they need.