There’s a health revolution underway in the Snack Food Capital, Hanover, Pa.
Utz Quality Foods, one of the largest snack manufacturers in a town known for its concentration of them, has opened an in-house primary-care clinic at its Hanover headquarters for the 2,000 employees and dependents covered by the company’s health plan there.
That may seem an off-brand move for a company known for cheese curls, pretzels, pork rinds — all the salty sins health nuts disparage. But employee health care is the second-biggest expense of running a business, regardless of whether it sells potato chips or heads of lettuce. Yet employers often have little ability to control the millions of dollars they spend on employee health care.
Health initiatives, such as chronic disease education, wellness evaluations and fitness classes, are old tropes among cost-conscious employers that have largely proven ineffective in stemming health expenses or improving employee well-being. But a new model of in-house primary-care clinics where employees can see a doctor, fill prescriptions, and even complete blood work is gaining momentum.
A third of companies with more than 5,000 employees have their own medical clinic, up from a quarter of large employers in 2012, according to an annual survey by Mercer, a human resources consulting company. Most reported a positive return on their investment — half said that for every dollar invested, they saved at least $1.50, according to the report.
“In general, these have been very successful,” said David Keyt, a worksite clinics consulting group leader for Mercer. “The caveat is you need to design the health center to fit the needs of the individual population. A positive return on investment isn’t guaranteed.”
Utz has 3,000 employees and a total of 4,000 people covered by its health plan across the country. Half of its members are in Hanover.
Since opening its clinic in October 2016, Utz says it has saved $1.3 million in employee and dependent health and pharmacy expenses, and slowed annual growth in health spending from 7 percent to 2.6 percent in Hanover. The company spent $10 million on health care for Hanover employees and their dependents in 2018.
The clinic reported 5,000 visits last year, with 73 percent of the plan’s Hanover beneficiaries stopping in at least once.
The company had tried the wellness bit before, offering a premium discount for completing a health risk assessment and biometric screening, and diabetes education.
“Some of the things we were doing just didn’t seem relevant. We’d see a slight decrease in spending, but it didn’t stick,” said Ginger Miller, a health and wellness coordinator at Utz. “If you put primary care in place, you can curtail some expenses.”
Administrators pitched the clinic to employees as a concrete way to save money, a major selling point for employees facing their own cost challenges in health care. Nationally, out-of-pocket costs for workers are rising faster than wages, which pushes many to delay or skip needed care, only to wind up needing more expensive treatment when their medical issue can no longer be ignored.
Utz offers a range of health plans for employees, with deductibles ranging from $450 to $2,700. Most plans require members to pay 20 percent coinsurance on bills once they’ve met their deductible.
Joe Hyser, whose job is to drive a dump truck of potato peelings from the Utz plant to three local farms to feed the cows, said he’s saved hundreds of dollars through the clinic.
Hyser, 62, of Hanover, is a cancer survivor who sees an oncologist once a year for a checkup and blood work. At a local hospital, the blood labs cost $500.
“Here, it costs nothing,” Hyser said of the clinic, “which is excellent.”
He’s also reduced his monthly prescription-drug spending from $120 to $15 by filling all but one of his prescriptions at the Utz clinic. The clinic carries 50 common generic medications, but the cholesterol drug Hyser needs is a brand name, so he gets it at a local pharmacy for $15.
He and his wife have been putting the money they’ve saved on health care to good use.
“We just got back from Bermuda,” said Hyser, whose tan proved it.
Bobbie Crook, a 65-year-old collections supervisor at Utz, began using the clinic as her primary care provider after her husband retired and she moved to her own health plan through Utz. The plan costs $40 a week and has a $2,500 deductible.
She saves money by filling three of her five prescriptions at the clinic’s pharmacy and said she’s less likely to put off doctor’s appointments because she knows she can see the clinic’s physician assistant for free.
“It means everything,” said Crook, who lives in Hanover.
A study led by RAND Corp. that was published in the Journal of Occupational and Environmental Medicine last year suggests the in-house clinic approach is working. The study analyzed data from a large urban school district with several on-site health clinics for some 6,000 teachers and found that compared with using community-based clinics, the workplace clinics saved about $62 per teacher per month, said Harry Liu, a senior research analyst at RAND and one of the study’s authors. The district also saw a decline in hospital admissions and sick days.
The model has gotten the most traction among large employers, with more than 5,000 employees, but smaller companies are getting in on the trend by pooling resources to invest in shared off-site clinics for employees.
Utz contracts Activate Healthcare in Indianapolis to run the clinic, a small carve-out in a packaging facility with two exam rooms, a lab room, a pharmacy, and a waiting area. Though it shares a wall with the re-packaging line, where bags of chips are packaged into boxes to be shipped all over the country, the clinic is not accessible from other parts of the building — patients go through a dedicated entrance at the back of the building.
Activate works with employers to create health clinics tailored with preventive, primary, and occupational health resources based on the company’s needs. Clinics are staffed by doctors, nurses, and physician assistants employed by Activate.
One of the major appeals of workplace clinics for workers is the experience — clinics are able to offer faster appointment scheduling, shorter wait times, and longer doctor visits than a traditional, overloaded doctor’s office.
“With an onsite clinic, you’ll have practitioners who are there, you can have face-to-face interaction. That’s very different from traditional disease management programs” that rely on phone consultations or brief, one-time appointments, Liu said.
Utz’s clinic has helped advance some of the company’s existing wellness initiatives, such as diabetes education, and enabled the company to introduce more wellness resources, such as a dietitian who will soon begin visiting the campus.
On their own, those programs could be a hard sell among workers surrounded by snacks all day.
Rather than just providing employees with information about how to manage diabetes, the clinic’s physician assistant, Suzanne Brill, can work with them to set personal goals.
“Our job is to express to people how to snack smartly,” Miller said. “We talk about moderation — how many cheese balls are in a serving?”
(Editor’s note: It’s 32 baked cheddar cheese balls per 150-calorie serving.)
The personal, unrushed attention he got at the Utz clinic persuaded Hyser to designate Brill as his primary care provider.
On Brill’s recommendation, Hyser started seeing a private dietitian earlier this year and has already lost 25 pounds by cutting down on sugar and carbs, and exercising more.