BY MILES MAGUIRE
One of the messages that you could take away from last month’s elections is that Americans do not have a great deal of faith in government. They turned against Democratic candidates in one state after another and made it clear that whatever benefits they were supposed to be enjoying from the signature achievement of the Obama administration–health care reform–they weren’t feeling it.
It’s against this backdrop that three local entities are about to embark on an experiment in intergovernmental cooperation focusing on medical costs that has the potential for improving the health of up to 7,000 area residents while saving significant money for taxpayers.
Sometime next month, the city, the county and the Oshkosh Area School District will open the Health Wave Clinic in the Bridgeview Center, the office complex where Witzel Avenue hits Ohio Street. Even its supporters acknowledge that the endeavor is a risk, and the cost is not unsubstantial—some $862,000 over the first year.
On one level it sounds like big-spending government run amok all over again. Get this, employees and their dependents who use the clinic will not pay a penny, at least to start and maybe beyond that, and they may even get their prescriptions filled for free.
The amazing thing is that the clinic, even if it continues to operate on a no-fee basis into the future, looks like it will save money for its sponsors, which means that it will save money for anyone who currently pays local taxes in the city or the county.
“For the employees it will mean quality health care at no cost,” said Sue Schnorr, the school district’s executive director of business services. “For the district, it saves our health plan money and over time it will save us money” by focusing on wellness and the management of long-term health conditions that if left untreated can balloon into huge costs down the road.
If that sounds too good to be true (and, let’s face it, it does), it’s merely a reflection of how health care costs and the system that supports them have gotten so completely out of control.
The clinic will be operated by a Brookfield company called Interra Health Inc. According to Ryan Sommers, one of Interra’s co-founders and currently its executive vice president, the cost savings that the clinic can achieve are based on two key factors: the use of lower-paid personnel, such as physician assistants as opposed to medical doctors, and a direct billing model that reduces administrative overhead.
The effect of those and other changes can translate into cost savings of 40 percent on the kinds of services that are available through primary care or urgent care providers.
“We’re comparing our costs for an on-site or near-site clinic to their insurance rates,” Sommers said. “It depends, too, on the service.” The 40 percent figure is an average. “For some services [the savings] might be 20 percent and on other services 90 percent.”
The clinic will be staffed with two medical assistants and two physician assistants/nurse practitioners. Medical assistants perform a mix of administrative and clinical functions under the supervision of licensed health workers. Their duties can include everything from greeting patients to drawing blood and performing basic lab tests. Nurse practitioners are licensed to provide most forms of primary care, including performing physicals, stitching up cuts and prescribing drugs.
“Their salaries are a lot lower” compared to what physicians earn, Sommers said. “And if you go to a regular place now you are going to see a [physician assistant] or [nurse practitioner] anyway.”
Using Interra’s business model, the medical staff will have more time to spend with individual patients. “They will be able to focus on wellness a little bit more,” said Oshkosh Assistant City Manager John Fitzpatrick. “That helps to shrink costs,” he said. “It’s not just a per transaction benefit.”
Another big factor in the savings comes from the way that the sponsors will get charged. “We basically do a direct bill,” Sommers said. “Our business model is based on eliminating the billing that happens with a lot of regular health care services.”
In other words, the sponsors will pay for operating the clinic, rather than having an outside administrator sort through an array of individual charges for different services.
Whether all these savings will materialize will depend on whether workers decide to use the clinic, which is being established as a supplement rather than a replacement for their health insurance plans.
One person who is optimistic about the future of the clinic is Michael Collard, the human resources director for Winnebago County. He previously held the same post in Sheboygan County, where he was involved in a similar clinic for five years.
After six months, that clinic was being used by 18 percent of the workforce, “and that was enough to put us in the black,” Collard said “That number went up to 30 percent, and we continued to save money.”
These were hard savings that could be counted, but he expects the total payback on the clinic to be much higher, at a ratio of 2-to-1 or better. Some of the savings will come from getting lower prices on lab work and immunizations.
But much larger savings are available if the clinic helps employees manage ongoing health problems like diabetes or high cholesterol.
“A health plan can really save a lot with chronic conditions,” Collard said.
Copyright 2014 Miles Maguire.
Miles Maguire is the author of Advanced Reporting: Essential Skills for 21st Century Journalism. Send questions, comments and suggestions to firstname.lastname@example.org.