Obamacare could threaten Toyota's health care innovation


Toyota's plant in San Antonio utilizes many innovations in both machinery and processes in manufacturing Tundra and Tacoma trucks, including awe-inspiring robotics. One would expect nothing less than the latest and greatest in manufacturing from a relatively new operation like this one. But one might not expect the auto manufacturer to be also a world leader in health care innovation.

Many larger employers have long had a nurse practitioner on-site to provide primary care for employees, much like the services available in retail clinics in pharmacies and big box retail stores. That service not only cuts down on the time away from the office, but also contributes significantly to the wellness of the employees.

In 2006, Toyota in San Antonio took that concept and expanded it by investing $8 million in a full-service primary care clinic. On staff are physicians, nurse practitioners, physician assistants, pharmacists, optometrists, opticians, physical therapists, occupational therapists, radiology techs and various other health care professionals.

The clinic provides services for the plant's more than 2,700 employees, their families and the employees and families of the 21 subcontractors located on the Toyota campus. All told, there are almost 6,000 employees; adding their families brings the total to about 17,000 people eligible to receive services at the clinic.

The company provides health care insurance similar to traditional plans with a network of physicians, hospitals and other providers outside of the on-site clinic. Employees and family members are free to choose between on-site, network and out-of-network providers. The incentive for getting care in the primary care clinic is two-fold: a very high quality of care and a much smaller co-pay than a network provider.

One noteworthy accomplishment of the clinic is its emphasis on wellness. By scheduling appointments with the doctor in 20-minute segments, patients receive the normal 10-minute exam plus another 10 minutes of time for education. These longer appointments address the age-old problem of how to pay physicians for their time to educate patients in wellness. Along with other wellness initiatives, patient education is bearing fruit.

The company's business plan projected a return on investment within 4 to 5 years. Instead, the ROI was realized in just 2 years. The clinic is now saving the company $3 million per year in health care costs.

The results have not gone unnoticed by other large employers. Among the several companies to visit and then emulate the Toyota model are Disney World and the Volkswagen manufacturing plant in Tennessee.

But how will the clinic be impacted by Obamacare? The unintended consequences of the massive legislation are voluminous, and they do not stop at the doorstep of Toyota's primary care clinic.

At the Texas Public Policy Foundation, we regard the "free" preventative care mandated in the legislation as a potential threat to the Toyota model. People choose to utilize the services at the plant, in our view, due to the lower co-pay; that incentive will disappear when Obamacare kicks in. Without the economies of scale, the clinic's continuing ability to provide quality care for employees and their families with significantly lower health care costs will be threatened.

Government-run health care will kill innovation on many fronts. Those of special concern are the ones that can actually bring down the cost, such as pharmaceutical research that produces drugs that keep people out of the hospital; health savings accounts that have been proven to lower the cost of health insurance; and even the Toyota primary health care clinic model for large employers.

Let's not sacrifice innovation on the altar of government control. Instead, we must replace Obamacare with policies that free up the entrepreneurial spirit that has given our country the best health care on the planet and work to make it more affordable -- just like Toyota has done.

Arlene Wohlgemuth is the Executive Director and Director for the Center for Health Care Policy at the Texas Public Policy Foundation, a nonprofit, free-market research institute based in Austin.

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