Dayton may become the first municipality in the state to open an off-site health and wellness center for employees to allay escalating health care costs.
The Dayton City Commission on Wednesday approved a $5 million contract with Health Stat Inc. to operate and manage an off-site clinic to serve the roughly 4,780 members of the city’s health care plan.
City officials hope plan participants who are “medically homeless” — meaning they do not have a primary care physician — will use the center instead of the emergency room or urgent care for non-emergency situations because it costs less.
“(We) want to control costs, and for the medically homeless, if we can get them in there and get them treatment before they get really sick, it’ll reduce costs for them,” said Peggy Thumser, Dayton’s benefit claims and wellness administrator.
The city has approved a three-year contract, with renewal options, with Healthstat to offer medical services at an off-site clinic at a discounted rate.
The company will operate a health and wellness facility that is open 40 hours a week.
City employees and their spouses, partners and children over the age of 2 will be able to utilize the clinic for some urgent care treatment and other basic medical needs, such as blood draws, physicals, screenings and cold treatments.
The city’s plan covers 1,821 employees, 1,016 spouses and partners and 1,962 children.
Dayton will be the first public employer in the state to offer an off-site health and wellness center, said Thumser.
Cincinnati has a health clinic, but it is used for workers’ comp claims and physicals. However, Healthstat has more than 300 clients across the nation, and off-site clinics are fairly common in other places.
Healthstat will bill the city for services, equipment, lease expenses and other costs. The total annual bill expected to be $1 million or less.
The clinic should be a money-saver because there should be fewer claims as employees utilize the new center, officials said.
The city paid almost $22.1 million in claims in 2015, after stop-loss reimbursements. The city’s projected premium costs increased by $2.3 million between 2012 and 2016.
The city is projected to pay $27.2 million in annual premiums in 2016.
Unfortunately, some of Dayton’s employees and other covered plan members are medically homeless and lack a medical doctor or primary care physician, said Brent McKenzie, Dayton’s deputy director of human resources.
These people often visit the emergency room or urgent care — which are highly expensive — for ailments that are not emergencies, including sinus infections and headaches, McKenzie said.
One plan member used the emergency room 16 times in a 12-month period, he said. Others have used it 10, 11 and 12 times in a year’s time.
‘We recognize that there might be circumstances when you have to go to the emergency room, but please have those be real emergencies because quite honestly (while) it is high-quality care, it is the most expensive type of care under our plan,” McKenzie said.
Employees and their loved ones, especially those with chronic diseases and conditions, should see a doctor regularly for checkups to ensure they are being healthy and their issues are not worsening, McKenzie said.
People with untreated conditions, such as diabetes, can face serious complications, like amputations, if they do not start taking the right medication and make other lifestyle changes, officials said.
Plan members who have family physicians are still encouraged to use the clinic for low-cost and convenient services that can supplement their medical care, officials said.
City employees will be allowed to visit the clinic during work hours. The center will have about 70 of the most popular prescriptions on hand, and the average wait time should be much shorter than many health care providers
“Employees will be able to get same-day appointments,” said Thumser. “The average wait time at (Healthstat’s) other clinics is five minutes.”
The average clinic visit could cost between $12 to $18.
The health center will produce a 1:1 return on investment if 30 percent of covered plan members use the clinic once a year, said Kenneth Couch, Dayton’s director of human resources.
If the utilization rate is 50 percent, the return on investment will be 3½ to 1, he said.
And it’s possible utilization will be high enough to produce a 5-to-1 return on investment, he said.
The clinic could open in October. However, the site has not yet been identified.
The city of Dayton in recent years has taken steps to try to control rising health care costs.
The city switched to a high-deductible health plan in 2008. Four years later, the city transitioned to a self-insured model from a fully-insured, indemnified program.
The city now requires the spouses of employees to make their work-provided health insurance their primary coverage. The change was negotiated with the city’s unions.
City officials say claims submitted by spouses and partners decreased by nearly $833,000 through June, compared to same period in 2015.
The city also negotiated with its unions to increase office co-pays after the deductible and add emergency room co-pays after the deductible as well. Premiums also went up.
The city expects claim amounts in 2016 and 2017 to be $5.2 million less than they would have been without the negotiated changes.
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