Having an onsite clinic vs. using traditional health insurance plans can impact your health costs in many ways. Not only are there savings to be discovered, but you will also have a clearer understanding of where funds are going and more control over how those funds are allocated.
So, what does having an onsite clinic mean for costs?
Increased Clarity on Spending
With traditional insurance plans, it can be difficult to determine exactly where your money is going. It can be even more challenging to locate areas where money is being spent on services that aren't actually being utilized or are being exploited or used incorrectly.
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With an onsite clinic, you'll have direct access to extremely valuable data regarding which services are being utilized, specifically how funds are being allocated, and if there are any ways to reallocate money to better serve your employees. For example, if you notice that an offered clinic service isn't being utilized, you could reallocate the money going toward that service to a more popular one.
More Control Over Costs
When you have an onsite clinic, you aren't tied to someone else's terms or rules like you are with an external insurance provider. A couple of areas that could have a big impact on cost are below.
Less Hospital Admissions & ER Visits
Often with traditional insurance, employees still find the cost a bit too high to take regular trips to visit their provider. This leads to behavior that can cost your company greatly, such as waiting until a sickness gets so bad it can no longer be ignored, then going into an urgent care facility instead of to their primary care physician.
High cost treatments and medications can also lead to chronic conditions going untreated which may mean more employees being admitted to the hospital.
A major benefit of an onsite clinic is that employees tend to visit them more regularly than outside facilities due to the affordability and ease of access. This leads to more preventative care, early detection, and quicker response to illness, as well as better management of ongoing conditions. All of these outcomes benefit your employees and increase their overall health and wellness but also keep your costs low over time. Read more about why healthy employees cost less, here.
Pharmacy Options Provide Savings
Insurance plans often come attached to predetermined prescription plans. There tends to be very little control over the options or how employees are able to utilize the plans.
With an onsite clinic, you can decide whether you'd like to provide an onsite pharmacy, fully-functional or limited. If your company doesn't want to offer an onsite pharmacy, you are able to do some shopping around for a plan that fits the needs of your workforce. You could also employ a mail-order service or select a pharmacy option that encourages and rewards the use of generic drugs vs. name brand which can save your company and your employees money.
Strategic Referral Programs Reduce Spend
The issue of employees either not having or underutilizing their primary care physician can lead to more referrals than necessary. Often, they won't have a good relationship established with their overworked physician so the physician may be more likely to refer them before they even fully understanding their medical history.
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In fact, 52% of specialty referrals are unnecessary and nearly 20M referrals are considered clinically inappropriate each year which increases risk of payment denial or delay.
With an onsite clinic, you can be selective about your referral providers and build a strong network of high quality specialists. The convenience of the onsite clinic will lead to better primary care practices so the patient/practitioner relationship tends to be more well established. This means the doctor will have the ability to more fully understand and explain options to the patient and come up with a well thought out care plan, often in-house.
There are a few secondary ways an onsite clinic can create savings for your company as well. The increased utilization of preventative healthcare and having established relationships with the primary care physician/s within an onsite clinic will raise the overall health and wellness of your workforce.
As this happens, you will begin to notice things like less sick days being taken (both for actual illness or for doctor appointments) as well as less illnesses being passed around the office. You may also find that your employee's results start to get a little boost. This is most likely because of the lowering of presenteeism, which is essentially employees coming to work when they are unwell and unfit to do their job to the best of their ability.
An onsite clinic may also give your company a boost when it comes to recruiting. Low cost or free health care, especially right there at work, is a massive benefit to offer to potential recruits. If your current employees are happy with the clinic and their benefits in general, they may also be more likely to refer people to work for your company.