Mercy to offer Ohio employers options for meeting health reform's insurance mandates

January 15, 2013

Primary care clinic system will improve health access, promote employee wellness

The Mercy system in northeastern Ohio soon will begin offering local employers a program that provides the cost savings of self-insurance, a provider network and an emphasis upon employee wellness.

The program will place primary care centers near employees and will provide incentives for them to seek care with in-network providers.

Lorain, Ohio-based Mercy has two hospitals in Lorain County, a growing western suburb of Cleveland with a population of about 300,000. Its new program, called SelectCare by Mercy, allows employers with as few as 25 employees to offer health care through a network of 1,800 providers at clinics and medical offices, the Mercy hospitals and University Hospitals in Cleveland, a research hospital affiliated with Case Western Reserve University School of Medicine.

Mercy operates Mercy Regional Medical Center in the city of Lorain and Mercy Allen Hospital in nearby Oberlin, Ohio. It is part of Cincinnati-based Catholic Health Partners.

Mercy executives announced the plan for SelectCare in December to a gathering of representatives from 110 Lorain County businesses. SelectCare already is in talks with potential participants and will begin operation during the first half of this year.

Edwin Oley, president and chief executive of the Mercy Lorain Region, said Mercy developed SelectCare through discussions with local business leaders who are working to comply with the federal Patient Protection and Affordable Care Act.

"Employers across the country are entering a new and challenging era," Oley said. "SelectCare by Mercy is an innovative health program designed to reduce employer costs while also improving employee wellness."

Mercy said SelectCare offers employers the potential for savings of 10 percent to 18 percent in the first 18 months of participation.

A key element will be a network of wellness clinics located close to participating employers. Enrolled workers will have the opportunity to go to those clinics for primary care and annual basic health screenings. They also will have the option of seeking follow-up care through the providers within the "narrow" SelectCare network, in which each provider has signed a network provider agreement through HealthSpan, a Catholic Health Partners affiliate.

Janis Yergan, Mercy's vice president for strategy and business development, said SelectCare offers smaller companies the advantages of self-insurance, allowing each employer to tailor the details of its benefits program. Employers would establish those benefits and service them through contracts with a third-party administrator, a separate company that manages self-insurance programs.

Yergan said SelectCare is not an insurance program or pool, and Mercy is not providing or offering insurance coverage. The third-party administrator would arrange reinsurance for participating employers to guard against catastrophic costs.

Another company will manage the clinics for SelectCare. That operator has not yet been selected, nor has the number or locations of clinics been set, Yergan said. The clinics will be known as Mercy Select Wellness Centers.

Companies enrolled in SelectCare will pay for care provided to employees, plus administrative costs and reinsurance. Through the clinics, employers can give workers access to chronic disease management and wellness programs for such issues as better nutrition and weight management.

Employee benefits can vary, Yergan said, but one benefit will be uniform — visits to the clinics will be without co-pays. The clinics will provide a primary care medical home, something that an estimated 30 percent of Lorain County residents don't currently have.

Yergan said employees who already have primary care doctors or other providers can continue seeing them without additional cost if they are in the SelectCare network. Additional charges for doctors outside of the network would vary by employer plan, and employees would not be required to obtain care within the network.

Yergan said the advantages of enrolling participants in primary care and wellness programs will outweigh the costs of setting up clinics throughout the county.

"There is a much greater cost to not having primary care physicians," she said. "People who don't take care of themselves end up in the emergency rooms, at much greater costs to everyone."

With most of America's health care bill driven by chronic illnesses including diabetes and heart disease, Yergan said, engaging employees in wellness programs will reduce costs for participating companies.

"Employers have found that they actually save money if they help their employees manage their wellness," she said.

To underscore that point, the keynote speaker at the SelectCare by Mercy rollout meeting Dec. 14 was John Torinus, chairman and former chief executive of Serigraph, a graphics company near Milwaukee. Torinus wrote The Company that Solved Health Care, a book about his success in reducing health care costs at Serigraph by one third.

"The medical side of health care in America can be brilliant, often sensational, with modern miracles happening every day," Torinus told Mercy's gathering of business leaders. But, "the economic side constitutes economic chaos. It is busted and has to be rebuilt."

Torinus said that will happen through "revolutions in the private system (that) are bending the cost curve," and he praised SelectCare for serving as one of the models.

Torinus said a key part of his program at Serigraph was getting employees more involved in their health care, both through wellness programs and higher deductibles and other employee-side costs.

Yergan said one major element of the wellness-clinic model is convenience. The SelectCare operator of the clinics will establish clinics within a 15-minute drive of participating companies, giving employees easy access to routine health care and continuing wellness programs. Yergan said a clinic could be located convenient to two client companies, possibly even within the location of a participating employer.

The clinics will provide primary care, basic laboratory services and generic medications.

For specialist or other care, participants will have access to in-network specialists, the Mercy hospitals or University Hospitals in Cleveland, typically at a lower cost than out-of-network providers.

The program provides incentives to companies that see improved health among their employees. Among the incentives could be multiyear cost guarantees.

Oley, the Mercy chief executive, said SelectCare "furthers Mercy's mission by making it possible for employers to provide comprehensive, high-quality health coverage, both in today's challenging environment and into the future."


Copyright © 2013 by the Catholic Health Association of the United States
For reprint permission, contact Betty Crosby or call (314) 253-3477.

Copyright © 2013 by the Catholic Health Association of the United States

For reprint permission, contact Betty Crosby or call (314) 253-3490.