On-site Health & Wellness Clinic City of Wauwatosa February 23, 2016

The Team Hays Companies of Wisconsin HR Staff Health Department Outside Counsel After finalist selected Froedtert has become of a part of the team

We have need and opportunity.

The Need Constraining Health Insurance Costs Attracting and Retaining Talent

Constraining Health Insurance Costs Upward trend of cost of health insurance Uncertainty about future increases Even when “successful” in managing increases the amount of inflation on claims consumes high percentage of available new revenue each year

Healthcare Costs 2016 Health Insurance related expenses in health/life budget Claims budget $6,866,701 (72.8% of health/life expenditures) Administrative fees $1,456,542 HRA contributions $ 445,000 $ 8,768,243

Recruiting and Retaining Talent City of Wauwatosa Strategic Plan: “Develop a high-performing organization through strategic employee development and compensation programs.” Employers Emphasizing Benefits to Recruit Talent Employees view health insurance as the most important benefit Source: SHRM HR Magazine Vol. 60 No. 9 11/1/2015

Mercer study

The Opportunity Space Funding

Space Space adjacent to the Health Department in City Hall 1. Furnish existing waiting area at bottom of steps in City Hall 2. Remodel storage room, convert to consultation room for medical assistant Update existing overflow exam room Move health department storage and create new overflow exam room and storage space

Funding Opportunity to re-invest funds Above target in reserve funding for health claims Cost of opening clinic covered by 2015 surplus health claims

RFP Process 6 proposals Froedtert Workforce Health finalist Community partner Flexibility Ability to staff clinic from local resources Credibility with employees Familiarity with wellness program for seamless integration Lowest cost proposal EPIC (electronic health record)

ROI MEASURES Hard Costs Avoided Costs Cost of providing care at clinic compared with cost of care through health plan Avoided Costs Emergency room visits PTO costs Loss of productivity Long-term Savings Through Improved Employee Health Managing chronic diseases More convenient Appointments longer Build relationship with provider

ROI Illustration – Example 1 Utilization Assumptions Total Visits per Month 70 # of Eligible Participants 1300 PTO $ Value Per Hour $ 50.00 Lab Cost $ Value (market rate) $ 25.00 Vaccine Cost $ Value (market rate) $ 30.00 Physician Office Visit $ Value (market rate) $ 130.00 On-Site Clinic Expenses PA Hourly Costs ($75 per hour x 20 hours per week) $ 6,000.00 MA Hourly Costs ($30 per hour x 20 hours per week) $ 2,400.00 Vaccine Charge ($25 per vaccine) $ 425.00 Basic Lab Tests (included in total fees) $ - Rx $ 1,000.00 Supplies (included in total fees) Monthly Management Fee $ 5,000.00 Total Monthly Costs $ 14,825.00 Health Plan Expenses (had visits run through plan, not the on-site clinic) Office Visit ($130 average charge x 66) $ 8,580.00 ER/Specialty Visits ($500 average charge x 4) $ 2,000.00 Vaccines ($30 average charge) $ 510.00 Labs ($25 average charge) $ 300.00 Rx PTO Expense (75% of visits x 3 hours x avg PTO rate) $ 7,875.00 Total Monthly Costs $ 21,265.00 Savings Summary Monthly Health Plan Expenses Monthly On-Site Clinic Expenses $ 14,825.00 Total Monthly Savings $ 6,440.00 Return on Investment Estimate Margin over Expenses per month Margin over Expenses per year $ 77,280.00 *Illustration only

ROI Illustration – Example 2 Utilization Assumptions Total Visits per Month 80 # of Eligible Participants 1300 PTO $ Value Per Hour $ 50.00 Lab Cost $ Value (market rate) $ 25.00 Vaccine Cost $ Value (market rate) $ 30.00 Physician Office Visit $ Value (market rate) $ 225.00 On-Site Clinic Expenses PA Hourly Costs ($75 per hour x 20 hours per week) $ 6,000.00 MA Hourly Costs ($30 per hour x 20 hours per week) $ 2,400.00 Vaccine Charge ($25 per vaccine) $ 425.00 Basic Lab Tests (included in total fees) $ - Rx $ 1,000.00 Supplies (included in total fees) Monthly Management Fee $ 5,000.00 Total Monthly Costs $ 14,825.00 Health Plan Expenses (had visits run through plan, not the on-site clinic) Office Visit ($225 average charge x 76) $ 17,100.00 ER/Specialty Visits ($500 average charge x 4) $ 2,000.00 Vaccines ($30 average charge) $ 510.00 Labs ($25 average charge) $ 300.00 Rx PTO Expense (75% of visits x 3 hours x avg PTO rate) $ 9,000.00 Total Monthly Costs $ 30,910.00 . Savings Summary Monthly Health Plan Expenses Monthly On-Site Clinic Expense $ 14,825.00 Total Monthly Savings $ 16,085.00 Return on Investment Estimate Margin over Expenses per month Margin over Expenses per year $ 193,020.00 *Illustration only

Excise Tax On-site clinics subject to Cadillac Tax? Cost of clinic may count toward excise tax IRS delayed effective date from 2018 to 2020 No one knows for sure how thresholds or tax will be calculated Nominal care provided at on-site clinics may not be included “Employers continue to launch worksite clinics despite ACA uncertainties- Mercer survey dated September 8, 2015” Clinic sponsors say savings will outweigh the cost Still positive net value

Current Wauwatosa Waiting Area

Current Health Department Storage Future Clinic Exam Room

Current Health Department Storage Future Consultation Room

City of Milwaukee Workplace Clinic (Froedtert)

City of Milwaukee Workplace Clinic Exam Room

City of Milwaukee Workplace Clinic Exam Room

Proposed Hours: Twenty hours per week with option to increase. Froedtert advised that the most critical hours for the success of an on-site clinic are Monday mornings.

Proposed Hours: Monday, 8am-3:30pm Tuesdays, 7am-12pm Thursday, 10am-5:30pm

Proposed Services: All services are free to employees and dependents, including select medications, and lab services. Diagnosis and treatment of minor illnesses and injuries such as sore throats, ear aches, sinus infections, flu or cold symptoms, urinary tract infections, skin conditions/rashes, and sprains/strains Preventive/wellness visits including physical exams and health coaching for lifestyle related concerns (i.e. nutrition, weight, exercise, smoking) Management of chronic disease conditions (i.e. diabetes, cholesterol, blood pressure) First aid/triage of work related injuries Proactive outreach for prevention an early detection (i.e. immunizations, wellness screenings) Additional services may be added in later phases, such as occupational health services (e.g. drug screening, pre- employment physicals, specialized physicals for protective service, physical therapy). If requested by Customer’s employee, assistance in providing continuation of care with the individual’s physician regardless of health system affiliation Provision of basic onsite lab tests, including glucose, lipid panel, urinalysis and screening for strep throat, and pregnancy. Administration of designated vaccinations Provision of educational resources addressing health and wellness topics Dispensing of select medications (excluding controlled substances).

Timeline to Opening Council approval early March Construction of build-out March-April Communication and Promotion March-April Opening mid-May

Future Opportunities Eligibility for part-time employees Expand hours depending on utilization Community partners More robust occupational health care NFPA physicals for fire department Drug screening Pre-employment physicals Physical therapy