More Employers Turn to Employer-Sponsored Primary Care Clinics

October 29, 2021 - Employer-sponsored primary care clinics are a steadily growing trend among large employers and one that experts anticipate to persist as a result of the coronavirus pandemic, according to a study conducted by Mercer and the National Association of Worksite Health Centers.

“As we look at 2021 survey results, we see reaffirmation of the tenets of employer sponsored health centers. Far from turning away from this popular benefit, employers are instead embracing it as the foundation of their health, safety, and well-being strategy,” the study stated.

Mercer fielded a survey from March to April 2021. Over 140 employers of varying sizes from 30 employees to more than 300,000 employees responded to the survey.

Almost a third of all employers with 5,000 employees or more and four out of ten employers with 20,000 employees or more stated that they had an employer-sponsored primary care clinic. The healthcare, finance, and government industries are most likely to offer an onsite or near-site primary care clinic.

Payers played a significant role in making this resource available to employees. 

Nearly two-thirds of all clinics were incorporated into the employer’s health plan. Some employers (27 percent) included clinic care as part of their population health management data by sending zero-dollar claims to their health plans. One out of five employers collected clinic fees that counted toward employees’ out-of-pocket costs.

Additionally, most employers (63 percent) worked with a third party in order to run the clinic. 

Nearly half of these employers used a cost-plus or management fee reimbursement strategy, which has been the traditional method of reimbursement for this model. However, capitated payment models were on the rise, increasing in number from 14 percent of these contracts in 2018 to 44 percent. Around three in ten employers used fee-for-service.

These clinics can offer telehealth and virtual care services and, during the pandemic, their capacity to provide these services expanded rapidly, with 65 percent of employers saying they expanded their clinics’ virtual care capabilities due to the pandemic. 

Clinic-based telehealth utilization grew from 21 percent in 2018 to 78 percent in 2021. These clinics provided access to a number of teleheath services, particularly disease management coaching and behavioral health. Some also offered physical therapy virtual care.

More than nine out of ten employers said that they supported a worksite clinic in order to improve access to care, quality of care, patient satisfaction, and productivity.

The data showed that employees are leveraging these clinics. In 2020, more than half of all eligible employees (52 percent) visited an employer-sponsored primary care clinic.

Employers largely used one strategy in order to drive employees to these clinics: more than nine out of ten employers required no copayment for clinic visits. Approximately a fifth of the employers reduced the copayment but did not eliminate it. Almost a quarter of all employers reported that they did not do anything to incentivize employees to use the clinics.

Employers who use health savings accounts to help employees cover healthcare costs may run into more challenges in leveraging a worksite clinic.

“IRS rules governing Health Savings Accounts require that employers offering an HSA-eligible health plan must charge HSA enrollees for services received at the clinic, regardless of whether that is preferred, if they are to remain eligible to make HSA contributions,” the study explained.

However, the experts noted that lawmakers have been working on ways to reconcile HSAs and worksite clinic models so new legislation may soon rectify this issue.

As a result, some employers have received a return on investment. Of the organizations that measured return on investment, three out of ten reported doubled return on investment, and slightly more than four out of ten reported a return that was 1.5 times as much as they invested.

The experts suggested that employers request for an independent review of the program every two years in order to ensure that their clinics are achieving high quality of care.

Worksite clinics can serve a variety of employer goals.

Other research organizations have recommended worksite clinics as one way that employers can lower costs. In 2019, when the medical cost trend was expected to escalate by six percent in the coming year, PricewaterhouseCoopers experts suggested that employers leverage worksite clinics—among other methods—to control costs.

Worksite clinics can also improve member experience, according to a separate PricewaterhouseCoopers report from the same year. These clinics may be more conveniently located for employees, the report noted.

Additionally, employers who are interested in taking steps toward advanced primary care may choose to implement a worksite clinic.