TRANSMITTAL LETTER FOR BOARD MEETING OF APRIL 21, 2022
COMMITTEE ON PROCUREMENT
Mr. Brian A. Perkovich, Executive Director
Title
Authority to advertise Contract 22-RFP-08 On-site Health Care Services, estimated cost $750,000.00, Account 101-25000-612260, Requisition 1580030 (As Revised)
Body
Dear Sir:
The Human Resources Department is requesting authorization to prepare request for proposal documents for a provider of on-site health care services for the period from January 1, 2023 through December 31, 2025.
The purpose of this contract is to select a vendor to provide on-site health care services for use by the District’s employees. The COVID-19 pandemic has underscored how critical employee health and wellness are in allowing the District to fulfill its essential mission. The District continues to explore ways to safeguard the health of its employees and create a culture of health in the workplace. This is in direct alignment with the strategic plan which seeks to foster a culture that recognizes the value of every employee. Focusing on employee health and wellness has a positive impact on employee morale, can be a tool in recruiting top talent, helps the District ensure continuity of operations, assists in managing health care costs, and can increase the overall productivity of staff. A key factor in building a culture of health is making health and wellness visible in the work environment. Developing programs and initiatives that focus on health will further embed this message into the District culture. One such program is the introduction of on-site health care services for employees.
The nature of the work environment at the District is particularly well suited for on-site health care services. The District has a wide range of jobs that require physically demanding work including police officers, laborers and 12 different skilled trades. In addition to the nature of the work, the environment itself includes potential exposure to such hazards as sludge and untreated wastewater, hazardous chemicals, heavy machinery and industrial equipment, and high voltage electricity. The wide variety of physical hazards in the work environment and the physically demanding nature of the work, provide an opportunity for on-site health care services to have a meaningful impact on the population health. This positive impact on health can help ensure employees can safely and effectively perform their job.
The District has utilized on-site health care services in the past. Occupational nursing services were used at the Stickney Plant through the end of 2009 when the contract was not renewed due to budget constraints. The nurse was responsible for providing medical first aid, immunizations, spirometry and hearing tests, blood pressure checks, and CPR training. The nurse was available Monday through Friday from 7:00 a.m. to 3:30 pm. During the final year of the contract, the nurse treated 3,710 employees providing a total of 5,308 individual services. The most frequent services provided during that period included: blood pressure checks (2,251), health counseling (1,370), first aid (447), immunizations (368), and follow-up care (85).
The reintroduction of on-site health care services at the District would have the following objectives:
Provide convenient access to basic health care services
The on-site nurse would provide routine health care services such as performing a basic physical examination; diagnosing and treating common and chronic health problems (i.e., infections, injuries, asthma, diabetes, hypertension); conducting preventive screenings; prescribing, and possibly dispensing, medications; administering vaccinations; and providing health coaching and counseling. These services are typically performed as part of a standard office visit with a physician. This is not meant to replace the need for a primary care physician but can serve as an additional resource for employees to get the care they need for routine health issues without the need to schedule an appointment with their regular physician or make a visit to an urgent care clinic. The average cost of a visit to the primary care physician is $130.00. The average cost of a visit to an urgent care clinic is $135.00. Each visit eliminated using the on-site nursing services will have a direct impact on health care costs by reducing the claims related to professional services. The employee will also benefit by avoiding the co-insurance (approximately $20.00 for PPO) or co-payment ($25.00 for HMO) that would result from a medical claim for a visit to the physician.
Reduce lost time, absenteeism and presenteeism; improve productivity
By providing access to health care services on-site, employees will be able to get the care they need without leaving the worksite or missing work on a subsequent day for a doctor’s appointment. This should reduce lost time and absenteeism related to minor health issues. A study conducted by Mercer in 2010 compared the lost time of care received in a traditional setting versus care received on-site. The study estimates that each visit shifted from the traditional office setting to the on-site setting would reduce lost time by 2 hours. Each unnecessary emergency room visit that is shifted to the on-site setting reduces lost time by 4 hours. The table below shows the results of this study.
Traditional Setting On-Site Setting
Office Visit 150 minutes 30 minutes
ER Visit 270 minutes 30 minutes
Pharmacy Visit 75 minutes 15 minutes
§ Estimates include travel, wait and treatment times
In addition, getting the appropriate care in a more timely manner should allow employees to return to full productivity more quickly. This is especially true if the on-site services include the ability to write a prescription and potentially dispense common medications (i.e., antibiotics, pain relievers, etc.). These services should also reduce presenteeism, defined as employees that are at work but not functioning at full capacity.
Promote health and wellness and provide basic preventive screenings and immunizations
The on-site nurse can be leveraged as part of the employee wellness plan. The nurse can provide biometric screenings (i.e., blood pressure, body mass index, cholesterol checks, glucose) as part of the District’s push for employees to access preventive services. The District currently conducts annual on-site health fairs which include a biometric screening. In 2019, 244 employees participated in these events at a cost of $54.00 per participant. The nurse would be able to provide these screenings throughout the year making it more convenient for employees to take advantage of this service. Marketing campaigns could be conducted throughout the year promoting similar health and wellness events with the nurse serving as the centerpiece of these services. The nurse would also provide basic health coaching for employees. This can be particularly valuable to employees managing chronic conditions. The nurse serves as an easy access point for these employees which can improve their adherence to treatment plans prescribed for these conditions. Management of these conditions can have a significant impact on medical claims. For example, Blue Cross Blue Shield estimates the projected cost savings for a diabetic employee whose condition is “well-managed” from a clinical standpoint is $1,158 per year. Finally, the nurse can administer immunizations such as flu shots, tetanus, or COVID-19 vaccines/boosters. In 2019, the District offered flu shots on-site through Blue Cross Blue Shield. There were 350 employees that participated in the flu shot events. The total administration cost of the flu shot event was approximately $15,000. The administrative portion of this expense would be eliminated if the vaccinations were administered on-site by the nurse. The convenience of making the vaccinations available throughout the season should also help increase participation rates. These preventive services can have a significant impact on the population health which benefits both the employee and the District.
Acute care services for work injuries; determine appropriate means of care
One of the roles of the on-site nurse will be to provide traditional occupational health services managing work-site injuries, illnesses, and exposures and providing follow-up care. In this capacity, the nurse will be able to triage these incidents and determine the appropriate level of care. This should help eliminate unnecessary visits to the urgent care clinic or the emergency room. Each unnecessary visit avoided will have a direct impact on health care claims. The average cost of an emergency room visit in 2020 was $1,555.00. The employee would also benefit by not unnecessarily incurring an emergency room co-payment, currently $100.00. In addition to avoiding unnecessary services, the nurse may also identify a critical need for care helping prevent a more serious health event. Finally, the nurse can be utilized as part of the emergency response plan providing the District with a resource with medical training on-site.
Perform required job-specific evaluations for existing employees
The District is required to perform certain medical evaluations mandated by occupational health guidelines for employees in specific job classifications. Some examples are audiometric tests, spirometry (lung function) tests, and respirator evaluations. These types of tests are currently performed by qualified vendors under separate purchase orders issued each year. The goal would be to leverage the on-site nurse for these evaluations and eliminate the need for the purchase orders related to the services. The District spends approximately $11,000.00 per year on these services.
Enhance recruitment and retention by making employee health and wellness a priority
The presence of an on-site nurse and the services this position provides are a visible, tangible sign that the District values its employees. This can be a powerful tool in attracting top talent to the organization. Company culture is also shown to be a top reason employees stay with an employer. A culture that focuses on the wellbeing of its employees and seeks to build this into the work environment is much better positioned to retain its top talent. This is a focal point of Strategic Goal #3, Workforce Excellence under the new strategic business plan.
To accomplish these objectives, the District is seeking to add an advanced practice nurse (APN or APC) also referred to as a nurse practitioner to provide on-site health care services. In a workplace setting, one of the main advantages of hiring an APN over an occupational nurse is the ability to prescribe medications. An APN would be able to not only diagnose a health problem but also prescribe the treatment for more routine health issues. This ability to write a prescription to treat an issue is a key factor in reducing the number of doctor’s office visits by employees and the amount of lost time related to these routine health issues.
The nursing services would be provided through this professional services contract. The cost would also include basic supplies and the use of an electronic medical record system. It may also include a medical support position or administrative support services depending on the recommendations of the vendors based on the services and hours of operation requested by the District. Some additional costs may be required for the purchase of vaccines and laboratory tests on an as needed basis.
Most on-site clinic providers consider locations with at least 500 employees to be good candidates for on-site health services to provide the best opportunity for a return on the investment. Given this recommendation, the primary focus of the services would be the Stickney location with its population of approximately 600 employees, utilizing the existing space that had been setup for the prior nursing services. In addition, the District would develop a plan to share the nursing services across several of the other larger plant locations. The goal would be to create a rotation with the Stickney plant at the foundation of the schedule but extending these services to employees at other locations on a rotating basis.
Appendix A (attached) compares the estimated costs associated with adding on-site nursing services with the expected savings that would be generated. The result is a return on investment of approximately $12,000.00 in the first year. This return on investment is based on projections from utilization data in the final year of the prior nurse contract. The projections do not include other positive impacts related to recruitment and retention, improved employee morale, increased employee engagement, and savings that may be achieved over the long-term through improved condition management and employee utilization of preventive care services.
The reintroduction of on-site health care services would reinforce the District’s commitment to the health and wellbeing of its employees, our greatest asset. This would support Strategic Goal #3 - Workforce Excellence by fostering a culture that recognizes the value of every employee. Demonstrating this commitment to our employees through a visible, tangible program such as this can lead to a healthier, more engaged, and motivated staff ready to help the District achieve its vision. It will also serve as another tool to help the District attract top talent as it builds its workforce of the future.
The estimated cost for this contract is $750,000.00. The estimated annual expenditures are $250,000.00 in 2023, 2024, and 2025.
No bid deposit is required for this request for proposal.
The Diversity Section reviewed the request for proposal and concluded that the contract does not provide practical opportunities for subcontracting since there will only be one nurse assigned to provide the on-site health care services. As such, Appendix A and Appendix V will not be included.
The tentative schedule for this contract is as follows:
Advertise May 25, 2022
Proposals Received June 24, 2022
Award September 16, 2022
Completion December 31, 2025
Funds will be requested for 2023 through 2025 in Account 101-25000-612260 and are contingent on the Board of Commissioners’ approval of the District’s budget for those years.
In view of the foregoing, it is recommended that the Director of Procurement and Materials Management be authorized to advertise Contract 22-RFP-08.
Requested, Beverly K. Sanders, Director of Human Resources, BKS:JEF
Recommended, Darlene A. LoCascio, Director of Procurement and Materials Management
Respectfully Submitted, Barbara J. McGowan, Chairman Committee on Procurement
Disposition of this agenda item will be documented in the official Regular Board Meeting Minutes of the Board of Commissioners for April 21, 2022
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