5 Ways Employee Health Centers Deliver Significant Savings

Healthcare in the U.S. is projected to cost more than $5 trillion by 2025. Costs rise about 5% every year, a rate that continues to outpace inflation.  

In 2023, the average per-employee cost of employer-sponsored health insurance increased by 5.2%. The number climbs to 7.8% for employers with less than 500 employees.  

These rising costs result from worldwide inflation, employees staying in the workplace longer, and steep increases in prescription drugs, among other factors.  

Employer pharmacy costs rose by 8.4% in 2023, making it the largest contributor to health plan costs. New gene therapies to fight cancer cost employers tens of thousands of dollars while GLP-1 drugs — now commonly prescribed for weight loss — cost over $1,000 per month for a single injection. 

“All those costs frankly get passed along to the consumer, and in this case, passed along to self-insured companies that have to pick up the bill,” says Marcus Such, Chief Actuary for Marathon Health.  

To reverse spiraling healthcare costs, employers open dedicated health centers at the workplace or nearby to provide employees with comprehensive primary care, health coaching, behavioral health support, lab testing, and medications. 

Let’s look at five ways employer health centers deliver tangible savings while providing convenient access to world-class care. 

1. Chronic Condition Management 

Sixty percent of adults live with at least one chronic condition, such as heart disease, obesity, or diabetes, while 40% of adults live with two or more. The Centers for Disease Control and Prevention says chronic conditions remain a leading cause of death and key driver of healthcare costs. 

Unmanaged chronic conditions become worse over time, further exacerbating costs and in many cases requiring hospitalization. However, many chronic conditions can be reversed or eliminated entirely through lifestyle changes and close monitoring. 

For diabetes management, Marathon Health identifies diabetic employees through biometric testing and connects them with health coaches to craft a personalized treatment plan and provide ongoing management. Employees receive continuous glucose monitoring devices to monitor blood sugar levels 24/7 and give providers real-time metrics.  

“When you get diabetes under control, there’s around $15,600 of savings per year per diabetic, versus if they're not getting tested or controlling their A1c,” Such says. 

Hypertension is another common condition impacting employees. The CDC says nearly half of  adults experience high blood pressure. Since hypertension presents few symptoms, employers incentivize employees to undergo annual biometric screenings and physicals with Marathon Health to identify high-risk workers. Employees can obtain remote blood pressure cuffs as well as medications from the health center, at little to no cost. 

“If you have an employee who's running 150 over 95 blood pressure, but we get them under control through medication, exercise, and better diet, you can expect to save about $2,000 per year from treating that chronic condition,” Such says. 

Marathon Health leverages data to ensure chronic condition interventions improve employee health. Once employees begin to engage with Marathon Health providers, most make tangible improvements. 

“Seventy-five percent of people that we interact with who start in a high-risk position see improvement after management with Marathon Health,” says Robert Simes, Vice President of Analytics and Business Intelligence at Marathon Health. 

2. Value-Driven Referrals

In the fee-for-service market, healthcare providers receive incentives for referring patients to in-network specialty care, increasing both the number of referrals and costs. In fact, Harvard University researchers found a 22.6% increase in specialist visits from providers affiliated with hospital systems, despite no changes in readmission rates or hospitalizations. 

“In the fee-for-service world, one in five primary care visits results in a referral to a specialist at an average cost of around $976,” Such says. “We’re around 10%, so we generate half of the referrals to specialty care at close to $1,000 in savings per employee to the health plan.” 

Marathon Health takes a value-driven approach to referrals. With no affiliation to hospital systems, providers refer patients based on quality, cost, or location. And with no financial incentive, providers only refer patients to specialty care when absolutely necessary. 

For instance, an MRI from a hospital system might cost $2,000, while the exact same service costs $500 from an independent imaging center. Marathon Health’s referral coordinators work with the employee to choose the right specialist based on factors that matter most to each employee. 

3. Reducing Urgent Care and Emergency Department Visits 

People typically rely on urgent care centers or the emergency room when they lack other options or have to wait several weeks to see their primary care physician. Providing convenient access to quality care at the worksite gives employees a cost-effective alternative to visiting an ER.  

“We tell employees, ‘We're here for your acute needs. Don't go to the emergency room where you're going to spend 7 hours. Come see us instead,’” Such says. 

Same and next-day appointment availability enables employees to seek care when they need it, without the hassle of leaving work or driving across town. Engaging high-risk employees and connecting them with chronic condition management helps employees get on the right track and reduce emergency department visits. 

“It’s a direct cost avoidance from having to go to urgent care, which can save anywhere from $150 to $300 a pop for a self-insured employer,” Such says. “On the emergency room side, cost savings are much more significant, averaging around $2,000 to $3,000.” 

4. Better-Value Care

In the traditional healthcare system, patients typically experience long wait times to schedule an appointment with their doctor, and then wait for up to an hour in the office before seeing the doctor. It’s a lousy experience that turns some people off from seeking care altogether. 

“You spend on average 9.7 minutes with a provider, whether it be a nurse practitioner or a physician, and then they bill you for $137 bucks for roughly 10 minutes,” Such says. 

Marathon Health providers see a set number of patients per day, which gives them more time to ask questions, build relationships, and treat the whole person.   

“Our providers spend 30 to 40 minutes with each patient. That means the value of our appointments is more like $350 to $450 each,” Such says. 

Simes says employees often schedule same or next-day appointments for both preventive and acute visits with Marathon Health. This helps employees get care right when they need it, which helps employees avoid the emergency room. 

“With a typical preventive visit at a community-based provider, you're probably three weeks out from getting an appointment,” Simes says. 

Marathon Health not only makes it easy to schedule the appointment. Once in the health center, the entire process flows seamlessly. 

“Ninety-two percent of our visits have less than a five-minute wait to see the provider,” Simes says. 

Ultimately, an exceptional patient experience translates to repeat visits and builds trust between the employee and provider, leading to health improvements and lower costs. 

5. Direct Employee Savings

Most employers cover cost sharing so employees pay no fees or copays whenever they visit the health center. Employees can also obtain hundreds of common medications and lab draws at no cost.  

“This isn't just about saving the employer money, it's about the individual end user who is now spending less out of their paycheck to consume care,” says Katie Vicars, Senior VP of Client Development at Marathon Health. “We send less referrals out because we can do more in our health centers and better manage that individual's care, which means they're not hitting their deductible.” 

Providing an employee health center also saves employers money by helping them attract new talent and retain valuable employees. 

“While employee savings is harder for us to quantify, providing health center services is a major driving factor in keeping talent on board,” Such says. “We have clients that saw huge decreases in turnover rates after implementing a program like Marathon.”