How Employers Are Reducing Healthcare Costs with Smarter Primary Care

With increased demand for expensive weight loss prescriptions, advanced gene and cell therapies, and inflation, employers face rising healthcare costs. According to the Business Group on Health, the projected increase in healthcare costs before plan changes lands at 7.8% in 2025, the highest projection seen by this survey in 15+ years. 

In a competitive hiring landscape, employers aim to provide meaningful benefits while keeping costs in check. One measure for this is evaluating vendor partnerships, according to the BGH survey. In fact, 85% of respondents said they would implement immediately or strongly consider cutting ties with underperforming vendors as part of their healthcare cost reduction strategies. 

Put simply, today’s employers can’t afford to wait years to see value from their benefits strategy. Due to access, traditional healthcare is largely reactive, often addressing health issues after they arise. Proactive care flips this model, preventing expensive treatments by keeping people healthy from the start. 

“Complications of our most prevalent diseases are our highest cost conditions,” says Dr. Natasha Parekh, Clinical Vice President/National Medical Director at Marathon Health.  

“What that tells me is there's a significant opportunity to screen and diagnose those highly prevalent conditions early so we can prevent progression to high-cost conditions like congestive heart failure and end-stage renal disease.” 

The data agrees. For example, with advanced primary care delivered via a Network model, Indiana employers, on average, achieve 1.2x return on investment in the first year, and up to 3.7x by year five. 

Read on to learn more about how advanced primary care improves outcomes while offering employer healthcare cost savings.  

The hidden costs of reactive healthcare 

KFF research shows more than one-third (36%) of adults say they have skipped or postponed obtaining needed healthcare, while one in five note they have skipped filling a prescription, both due to cost. 

But delayed healthcare results in costly downstream effects, including urgent care or emergency room visits and late diagnoses.  

Preventive care provides tangible savings. Take chronic conditions, for example, which affect 60% of Americans. 

“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,” says Marcus Such, Chief Actuary at Marathon Health. “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.” 

Providing acute and preventive care in a predictable environment offers spend control, too.  

“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.” 

Advanced primary care ROI 

To address the rising costs of healthcare, many organizations are buying into advanced primary care, a value-based solution that helps organizations control the cost of healthcare while offering members an improved experience through a true healthcare home where providers spend quality time with patients to understand their needs. 

A National Alliance of Healthcare Purchaser Coalitions survey shows 76% of purchasers currently offer an advanced primary care model or are considering adoption within the next one to three years. 

“Advanced primary care is a 21st-century approach rooted in decades of evidence,” says Dr. Nirav Vakharia, Chief Health Officer at Marathon Health and a practicing primary care physician. “For more than 50 years, research has shown that strong primary care leads to better clinical outcomes, less unnecessary utilization, and lower costs. What sets advanced primary care apart is that it doesn’t reinvent the fundamentals — it delivers them with greater consistency through timely access, continuity between patients and providers, and whole-person care.” 

A recent Marathon Health study shows engaged members have:  

• 21% lower claims costs 
• 82% higher primary care utilization 
• 15% fewer emergency room visits 
• 41% fewer inpatient admissions 

“You’re always going to have claims spent,” says Jon Schloemer, Sr. Consultant, NA Health and Welfare Plan, Cargill. “You see your healthcare numbers and you're like, ‘Can our plan continue to afford this?’ When you're being proactive with those dollars, investing in the employees and preventive maintenance, you're using the dollars the right way as opposed to being reactive because someone showed up at the ER with something major. By spending the money upfront, you’re stabilizing your employees’ and their families’ lives and making it easier for them to take care of themselves in a system that can be very challenging.” 

Indiana case study 

More than 50 organizations in Indiana utilize the Marathon Health Network, which was built in partnership with brokers, to provide employees with quality care and a healthcare home while lowering the organization’s healthcare spend. Results include: 

• $1,100 average annual savings per engaged member 
• 3.7 average ROI after five years 
• 89 Net Promoter Score (NPS) among members 

“It's hands down the best thing that we ever did,” says a Senior Director of Human Resources at the Indianapolis Airport Authority. “Not just because it has saved us money on our health plan, but let's face it, it's the right thing to do. If you're not taking care of your people, they're not taking care of your business.” 

Marathon partners in Indiana have reported substantial improvements to health metrics like blood pressure, BMI, cholesterol, and markers of pre-diabetes. At a large public employer, 77% of members made improvements on at least one biometric marker. 

Download the case study to see how the Marathon network helps employers like you

What it means for HR and finance leaders 

While members of the Indiana Marathon Health Network reap the rewards, they do it without the associated capital expenses and operational responsibilities of an onsite health center. Networks offer a turnkey implementation process of approximately 90 days and a ROI within a year.  

In addition, the solution is scalable, as Marathon Health continuously monitors Network footprints for opportunities to expand access and services in step with our growing employers.  

Employers utilizing Marathon Health enjoy a healthier workforce and foster workforce trust. 

“The idea that someone who barely knows you can care enough to give you what you need to get healthy is a beautiful thing,” says a Marathon Network patient in Indiana. “The whole team there has always made me feel like a part of a family and always made me feel better when I leave.” 

For a deeper dive into how Indiana employees took control of healthcare costs and outcomes, read the Indiana Network case study here.