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Site-Based Clinics: Do It Better or Else

Analysis  |  By Philip Betbeze  
   July 27, 2017

Hospitals and health systems have a major chance to grow and diversify with site-based clinics, but a host of for-profit competitors are competing with them on this fast-growing opportunity.

It's no secret that healthcare is being "disintermediated." But that word has become something of a cliché in a world in which Amazon serves as the disintermediator-in-chief.

Think of disintermediation as death by a thousand cuts—for-profit companies setting up businesses based on pieces of what the hospital or health system used to exclusively control in a given market.

This has been going on for years in imaging, outpatient surgery, and even primary care. But it's also evident in other areas that hospitals may count on to diversify their revenue streams, such as direct-to-employer contracting.

One area of direct-to-employer contracting that many hospitals and health systems have sought to exploit is so-called site-based clinics.

Many employers know they can realize potential cost savings by getting employees to access regular healthcare services as a way to prevent more expensive interventions down the road.

But site-based clinics can also be a gateway to population health. On-site clinics can be used to change behaviors, leading to greater adherence for employees who suffer from chronic conditions such as obesity or diabetes.

If hospitals can't use onsite clinics to provide more than illness and injury treatment, they'll face strong competition that may be able to outmaneuver them.

The 'Irony' of Population Health

"If you can manage patients more proactively, you can manage them more effectively," says Debra Geihsler, principal with Activate Healthcare, an Indianapolis-based for-profit provider of site-based clinics and wellness services for employers.

One of the ironies of population health is that to cut the cost of providing health care to a group of people, there's no substitute for managing health at the individual level.

Clinicians who staff the onsite clinics, including doctors and nurses, understand that their overarching priority is to help coach the patient toward better overall health—not to triage sick patients, although they do that too.

Geihsler knows wellness is often where hospital and health system-based clinics are deficient.

Before starting Activate with former Steak & Shake CEO Peter Dunn in 2009, she served as president and CEO of Harvard Vanguard Medical Group and Atrius Health System in Boston. Before that, she was CEO of Advocate Medical Group in Chicago.

Geihsler says many organizations don't understand that the patient is the ultimate arbiter of improved outcomes. Managing them on an individual basis is often the missing link.

"The patient is the only one in the room who can improve outcomes, so we strive to get 85% of employed members to utilize the clinic," she says.

"We try to engage the employed members to be leader of the communication process and we provide critical wellness counsel."

Beer, Wine, and Health

Monarch Beverage, a 750-employee, family-owned beer and wine distributor in Indiana, uses Activate for its on-site clinics and health management services.

Before engaging Activate, it partnered with a local health system to manage its on-site medical clinics, used primarily for physical therapy and primary care.

The idea was to minimize workers' comp expenses, but over time, the company recognized the need to manage workers' unhealthy behaviors and lifestyle choices.

"If people are unhealthy, it will play itself out on the medical front," says Natalie Roberts, a senior vice president who once managed human resources for the company.

"When we went to expand the concept years ago, we were able to partner with a big hospital."

The hospital was the partner for the onsite clinic for five to six years, but couldn't really get past managing the low-hanging fruit of providing low-cost office visits and convenient follow-up care.

It wasn't equipped or interested in population health, including health coaching, better weight management, reducing smoking rates and reducing cholesterol levels.

"The providers didn't really get it," Roberts says.

Activate, which employs the clinic's physicians and other clinicians, also provides health coaching and offers virtually unlimited (and typically free) access to primary care physicians.

Most appointments are seen on a same-day basis. Employees see wellness services as an added benefit, typically, which makes it easier for Activate to get to its stated goal of having 85% of employees using the on-site clinic for their care.

"Over time, costs go down because patients are managed more effectively," says Geihsler.

Many of Activate's clients are county or city health plans or manufacturers, and they pay Activate a per-member, per-month fee, guaranteed at a negotiated level for three years, to engage consumers on their care, with the ultimate goal of reducing high-cost interventions among the population by in part, tying changes in lifestyle to changes in patients' health.

Changing the Message

Along with the change in partners, Monarch started to change its messaging to employees. It had eliminated premium increases for employees for five years, but that became untenable as the "low-hanging fruit" was harvested, says Roberts.

"We started to change our message," she says. We told employees "if we see a decrease, you'll also see one, but if we see an increase, it will go up for you as well. You have to help us with this problem."

That gets employees to sign up for health evaluations and use the resources the on-site clinics offer.

"If you choose not to take advantage of these programs, you'll pay disproportionally to your co-workers," she says.

In addition to the onsite clinics, Monarch boasts a yoga gym, a cardio gym, and other incentives to manage health better.

"If your risk factors aren't improving, you have to pay more," she says. "What has happened is our culture has really shifted—whether you're a driver or material handler or executive, you have to get with the program."

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Philip Betbeze is the senior leadership editor at HealthLeaders.


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