By Jason Crane
The Aurora City Council approved a Resolution authorizing a five-year health services agreement with Marathon Health, LLC for the establishment of a near-site clinic.
City government of Aurora documents show the near site clinic at the Bloomhaven campus will allow for enhanced access to medical services and for cost savings for the City government and for employees in the provision of occupational health and traditional health care services.
City employees need routine occupational health and workers compensation services such as pre-employment physicals, drug testing, and immediate treatment and care for injuries sustained at work. The City has utilized various providers for these services over time, but challenges have arisen in cost structure and dwindling choices as providers have closed their occupational health clinics.
A near site clinic is essentially a medical clinic operated by a contractual partner who provides a wide range of medical services at a location near to a single employer or small group of employers. The goal is to provide quicker access to basic medical services such as primary care visits, basic medical testing, care of chronic conditions, dispensing of various prescriptions, basic first aid treatment, and occupational health services at lower cost for workers compensation claims and on a more convenient basis than traditional health care models allow.
Costs are based on a fixed monthly service charge plus variable costs for medicines and testing supplies. The costs for the medications and supplies will be at a lower cost than the City is able to obtain in the retail market. In fact, the claims savings increase and the financial model becomes more advantageous the more that insured employees and dependents utilize the clinic from a health insurance perspective.
Staff members have been working with the City’s health insurance consultant, Assured Partners, to investigate the various opportunities and existing models. Marathon Health, a national operator, was identified as a potential partner for the provision of a near site clinic which could combine occupational health and traditional health care services. They operate a successful clinic in Rockford that is the model for the proposed Aurora location. Staff members wish to be a partner with Marathon Health for clinic operations.
The City’s Human Resources team has been reviewing the benefits to providing a near-site medical clinic for the employees and dependents to access occupational health, medical, Rx and behavioral health services for the past 5 years. The following are continuing current challenges facing the City and its employees that City officials believe will be positively impacted by the proposed clinic:
Healthcare inflation at 9.5% remains above general inflation and is increasing.
Pending shortage of primary care physicians causing difficulty accessing same or next day appointments.
Behavioral health providers access difficulty scheduling mental health appointments.
Navigating the complex healthcare system.
Referrals to top specialists.
Benefits of direct primary care and Occupational Health Care for the City and employees:
Same-day/next-day appointments.
Immediate triage for workers compensation injuries.
Behavioral health provider access on-site.
Focus on patients with expertise in both Primary and Occ Health care – not billing and volume.
Improved health outcomes – assist members to top specialist for their respective condition.
Reduced healthcare and occupational health spent for both employees and the City.
No cost visits for PPO employees & dependents.
$25 visits for HSA employees & dependents.
200 + Prescription medicine dispensed for free at clinic for PPO members and IRS approved Rx are free for HSA members.
The clinic and above benefits will also be available for pre-65 PPO retirees and their dependents.
Costs are fixed versus increasing based on medical inflation.
The clinic will be in the Bloomhaven development and staffed with a MD, 2 medical assistants and a licensed behavioral health provider.
The City would benefit from a fixed cost for services model to staff the clinic as compared to the current model including occupational health services. Currently, medical trend is approximately 9.50% annually, much higher than the pace of inflation. The contemplated Medical Services Agreement with Marathon Partners would increase costs at approximately 4.76% annually, which is half of the current increase in medical trend cost increases.
In addition to the monthly staffing charges, the City would be responsible to reimburse Marathon for rent incurred at the Bloomhaven site totaling $75,000 per year as well as reimbursement for costs related to supplies consumed and prescription drugs dispensed by the clinic. There is also the possibility that the clinic could be opened to additional area organizations in the future to provide revenue and additional medical savings opportunities, further offsetting City costs for the clinic. Any such opportunities would be brought back before the Council for additional consideration at the appropriate time.
The goal is to have the new clinic open by next October 2025 in time for open enrollment and fully operational after that. The city would then no longer require the services of an outside medical provider for occupational health/workers compensation services, which would save an additional approximately $300,000 per year.
The next step is to put a request for proposal out for a general contractor to construct the approximately 2,500 square foot space required for the clinic and bring the recommended contractor back to City Council for approval.
Impact statement:
The build out of the space and first year costs will be financed with the improved pricing the City received from Blue Cross Blue Shield of Illinois on the medical plan for 2025 and savings from claims costs incurred. The City is receiving credits and savings from BCBS that total $1,662,000 for 2025. The total first year costs for the near site clinic are estimated to be $2,397,719. Cash flow savings of $1,266,666 are also anticipated in early 2025 as the changeover to all BCBS plans occurs. As utilization of the clinic increases the claims savings from the medical plan and occupational health expenses are anticipated to increase because of the lower costs of supplies and prescription drugs dispensed. The projected net savings to the City over the next 5 years is $6,412,238.
City officials stated the agreement should be approved to avoid the City and its employees to incur higher occupational health and traditional health insurance claims costs and continue to suffer with delayed access to necessary services.