Thinking Outside the Box
Corporate employee health is an opportunity for private practices.
Russell Certo, PT, OCS, and William McCormick, PT, MS, CSCS
At the 2014 Private Practice Section (PPS) meeting, it appeared that the general theme in many of the educational presentations was how primary orthopedic practices could expand their services to include medical fitness or general fitness exercise programs to their service offerings. There were many ideas as to how to best provide those services, including a small add-on fitness service with minimal disruption or, at the other extreme, provide employee wellness programs to corporate clients. Both the presenters and the participants discussed several strategies and business models. It was apparent that we are all trying to find ways in which we can expand our relevance/presence within the medical delivery system and grow our own businesses. One model or method to achieve this goal is developing a corporate employee health (CEH) program.
According to the Employee Benefit Research Institute 52 percent of employers are now self-insured companies.1 Because of certain provisions within the Affordable Care Act, it is estimated that over the next 5 years, 75 percent of all employees in the private sector will be covered by self-insured health insurance.2 Self-insured health insurance is simply an insurance product where the employer assumes the financial risk for providing health care benefits to its employees. In almost all cases, these companies contract the actual claims processing to a third-party administrator (such as Blue Cross). In an attempt to control the risk of health care claims, these employers have instituted “wellness” programs. However, many of these strategies do not measure outcomes and/or tie results to claims information. The most common form of wellness programming provided by the employer is an online health risk assessment (HRA) whereby the employee voluntarily answers a series of questions online and the software program provides an analysis and simple strategies for improving health risk markers. For example, if the employee smokes, the HRA suggest they stop smoking or if the employee has not had a yearly physical, the HRA suggests they visit their doctor for a physical. More sophisticated and robust “wellness” programs engage an outside contractor who analyzes claims history and the HRA information and provides the company with a snapshot of their employees’ overall health, creating general risk pools in which employees are placed. Additionally, the contractor is able to designate specific diagnoses or medical conditions of the employees that drive the health care claims cost higher.
In almost all instances, these self-insured employers are provided some data analysis by their third-party claims administrator or contractors but are never given appropriate or effective strategies for actually engaging employees in healthy lifestyles. We have identified this self-insured market as the greatest opportunity for growth for private practice physical therapy companies looking to provide medical exercise prescriptions. This opportunity exists for not only the single office practice but also for the multisite and large practices. We believe that physical therapy practices can become the “what’s next” solution for CEH programs. In the big picture, our practices can provide a meaningful fitness program that engages employees within individual companies, but we can also become partners with the third-party administrators that provide benefit coordination to many self-insured employers. In addition, these services provide us the opportunity to partner with the data analysis contractors who can then sell our interventions as part of their services to provide lifestyle management programs to the employee.
In the past 10 years, many of us have added fitness services to our primarily orthopedic practices by providing our discharged patients with a place to continue exercising. Many practices have used this service to expand into a cash-based business that supports the overall business model. Some of us have been able to develop diagnosis specific programs, partnering with primary care physician groups and growing our practices by as much as 30 percent because our referral base is larger and our footprint in our communities is bigger. Additionally, in our case, we have partnered with other private practices across the country to develop a network of like-minded practices that share our data, outcomes, successes, and even our failures. It is easy to find naysayers that say these add-on medical fitness programs have not been profitable for physical therapy businesses. Our experience has been that our fitness programs have been break-even propositions when looked at as a stand-alone entity. However, the medical fitness addition has increased our physical therapy income by 30-40 percent, providing a range of return on investment between 4:1 and 9:1 in some cases. Additionally, our partnerships with primary care physicians has made us more relevant in our local medical community, offering us new opportunities that we would not otherwise have had if we did not develop a fitness service.
In terms of the CEH program, we identified the larger self-insured employers and then subdivided that group into companies that had an onsite fitness center and those that did not provide onsite fitness. Marketing our experience in medical fitness and using our data, outcomes, and total-cost-of-care reductions collected over the past 10 years, we have been able to capture the attention of the decision makers at these companies. In general, we propose that these companies embed our employee in their fitness center, in some cases manage the fitness center for them, and begin to provide appropriate, effective, data driven exercise to their employees. We generally begin with a pilot program that identifies and engages the higher risk employees who are driving the health care claims higher. We have proven that our model of medical fitness will move employees from high-risk pools to moderate-risk pools and moderate-risk employees to low risk, potentially saving corporations hundreds of thousands of dollars annually. Our program not only includes exercise prescription but also provides educational seminars, nutritional information, and lifestyle management strategies that engage employees and retains 75 percent of the employees participating in the pilot program.
In terms of cost savings, there are obviously direct savings from a claims perspective but there will also be cost savings from the employer standpoint of reduced absenteeism, better productivity, and improved employee morale. For our physical therapy practice, we are able to create an income stream from the management of the onsite fitness center, individual payments for each employee enrolled, and over time, a shared savings model of payment. Also included in the income stream is the potential for additional physical therapy services at our clinic or onsite at the corporation.
For many of us, we have successfully tapped into the opportunities in our markets to provide outpatient orthopedic physical therapy services that are very traditional in nature. The old adage that “if you are not growing you are dying” is appropriate. We all recognize that if we do not adapt to changes in health care, we will become irrelevant and our business will struggle. As a group, we have realized that we can make a difference by providing appropriate exercise to medically compromised patients who cannot be served by the neighborhood fitness club and the local YMCA. We are the experts at delivering these medical fitness prescriptions and we are accepted members of the health care delivery system. Our growth in private practice for the single entity office and for the large multisite physical therapy business is in coordinating lifestyle management services that drive the cost of care down, flattening the cost curve, and sharing in those cost savings. These opportunities provide us another chance to serve our communities, work within the medical delivery system, and maintain our presence, relevance, and standing within that system.
Russell Certo, PT, OCS, of MOG at Grand Island Physical Therapy PC. He can be reached at firstname.lastname@example.org.
William McCormack MS, PT, CSCS, of MOG National. He can be reached at email@example.com.
1. Employee Benefit Research Institute. www.ebri.org/pdf/briefspdf/EBRI_IB_413_Apr15_RCS-2015.pdf. Accessed November 2015.
2. Employee Benefit Research Institute. www.ebri.org/pdf/briefspdf/EBRI_IB_413_Apr15_RCS-2015.pdf. Accessed November 2015.