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Sunday, 15 March 2015 22:00

Lakeshore manufacturers offer on-site clinics to combat rising health care costs

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A trio of Muskegon-area manufacturers partnered in launching the Muskegon Manufacturers Health and Wellness Clinics, which offers on-site or near-site health care services for employees and their families. A trio of Muskegon-area manufacturers partnered in launching the Muskegon Manufacturers Health and Wellness Clinics, which offers on-site or near-site health care services for employees and their families. COURTESY PHOTO

Three Muskegon-area manufacturing companies have banded together to create their own on-site health care clinics to better manage employee health.

In January, Muskegon-based Eagle Alloy Inc., Port City Group Inc. and Fleet Engineers Inc. offically launched the Muskegon Manufacturers Health and Wellness Clinics. Primarily, the clinics aim to provide employees with routine medical care similar to what they’d receive from a primary care physician.

Ideally, the clinics’ staff can treat medical conditions as they appear, including instances of workplace injury, as well as monitor pre-existing conditions to identify or ward off any potential chronic diseases.

“The bottom line is that healthy employees are less expensive employees when it comes to health care,” said John Workman, president and co-owner of Eagle Alloy.

The three manufacturers currently operate two clinics that are open 36 hours a week and offer free care to any of the companies’ employees.

The clinics are also open to workers’ families and can provide sports physicals for children along with pre-employment physicals for prospective employees. They also offer a 24/7 hotline for support.

The clinics are staffed by physician’s assistants, nurse practitioners and a medical director and operated through ProMedico LLC, a third-party firm that manages the day-to-day operations. ProMedico is part of the Lighthouse Group, an insurance brokerage that operates offices across the state.

“Certainly (rising health care costs) are a driver,” Workman said of the clinics. “If you identify a chronic issue when they come in for an acute issue, you’ll probably head off larger costs in the future.”

All three companies have adopted a self-insurance model for health care that allows for greater flexibility when it comes to designing outside programing such as health clinics, he said.


While the companies behind the Muskegon clinics won’t see immediate returns, it’s likely that they’ll experience long-term savings through an overall decrease in health care costs and improved productivity from workers, said Larry Boress, executive director of the National Association of Worksite Health Centers (NAWHC).

With more people having access to health care under the federal Affordable Care Act, access to primary physicians can at times be scarce, Boress said. That leaves workers often relying on urgent care facilities or emergency departments to treat routine or easily treatable conditions. Not only does that put a bigger financial burden on employees, but it impacts the employer’s health care costs and their bottom lines.

Forty percent of the companies that host onsite clinics at their workplace do not have doctors at all, Boress added. Indeed, a lack of primary care physicians was one of the reasons behind creating the Muskegon clinic group, according to Workman.

“It costs (employers) a lot less than if employees use the emergency room for a cough or an ear infection,” Boress said. “If you have a nurse on campus that can give a few minor prescriptions, then employees don’t have to pay out of their pocket. I think it makes a lot of sense.”

Of 255 companies surveyed nationwide by NAWHC across 15 different industry sectors, 116 indicated that they had onsite or near-site clinics. Sixty-four percent of the companies surveyed noted that the use of on-site or near-site clinics helped them reach their cost-reduction goals for health insurance.

These clinics also have the added benefit of being quickly accessible by employees pressed for time. Workers can visit the clinic quickly before or after work, thereby saving the company any potential loss in productivity from the employee leaving the facility for a routine doctor appointment or urgent care visit — both of which could take between four hours and the entire day, Boress said.

The savings in employer health care costs can also translate directly into lower premiums for employees, he said.


With insurance premiums largely on the rise, it’s likely that manufacturers will seek out new and innovative ways to cut down on health care costs, said Delaney McKinley, director of human resource policy and membership development at the Michigan Manufacturers Association.

Average health insurance premiums have risen 26 percent from 2009 to 2014, according to data collected by The Henry J. Kaiser Family Foundation as part of a 2014 Employer Health benefit survey. Average premiums for single-coverage and family plans tempered in 2014, rising only 2 percent and 3 percent year-over-year, respectively.

The average annual premium for employer-sponsored health insurance was $6,025 for an individual and $16,834 for family coverage in 2014, according to the Kaiser Foundation.

“I do expect manufacturers and other employers to look outside the box to address employee health care costs,” McKinley said. “They’ve been seeing dramatic increases in costs and they’re looking at more ways to get involved to avoid that uncertainty.”

Because of the increasing costs and uncertainty, more employers are likely to offer health care programing ranging from wellness programs to onsite clinics — particularly among smaller, regional employers, sources said.

Forty-eight percent of the respondents with fewer than 200 employees included some sort of worksite health program in their operations, according to the NAWHC survey.


While worksite clinics are more common in large organizations, smaller operations normally lack the resources necessary to fund a clinic. National firms such as Wisconsin-based QuadMed and Oklahoma-based CareATC require companies to employ at least 1,000 workers to make operating their on-site clinics profitable, said Amy McCulloch, an account executive who leads ProMedico.

Locally, Kentwood-based auto supplier Lacks Enterprises Inc. operates its own clinic through CareATC, which has operations in 16 states, said Mike La Penna, principal of The La Penna Group Inc., a Grand Rapids-based consultancy.

The Lighthouse Group began forming ProMedico in 2012 to address a gap in on-site health clinics for mid-size and small manufacturers in the region, McCulloch said.

“We wanted to bring the same advantages from employers across the country that have taken advantage of worksite clinics for 20 years and bring it to smaller manufacturers that are able to share resources,” she said.

ProMedico bills its clients based on the number of hours the clinic is operational and the number of employees that are seen by the health professionals.

The firm initially reached out to six employers in West Michigan as a test group — which included the three Muskegon-based manufacturers. ProMedico hasn’t limited its services to manufacturers and plans to open another clinic in August at a company in Northern Michigan, although the firm declined to provide further details on the project.

Even with ProMedico’s more regionally focused model, it’s likely that companies will follow the Muskegon-based manufacturers’ model and offer collaborative health clinics to minimize costs, sources said.

The model still requires some investment from participating companies. For example, Eagle Alloy invested $80,000 into building its clinic facility. The other Muskegon clinic — colocated near the Fleet Engineers and Port City Group facilities — was created in an existing space owned by Fleet Engineers.

“We always thought about having our own clinic and that it would be a good idea,” Workman said, “but to make it sustainable on a standalone level would have been hard for us.”

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