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Illustration: Rebecca Zisser/Axios

Large employers from the Rust Belt to Silicon Valley are turning inward as they try to find cheaper, higher-quality health care, embracing ideas like onsite clinics or direct contracts with specific hospitals.

Why it matters: Employer-based benefits are the backbone of the U.S. health care system. But for all the talk about revolutionizing the system, some of their most popular strategies for dealing with rising health care costs are old ideas that don’t exert much pressure on the system overall.

The big picture: There are ways for big companies to save themselves money by exerting greater and more direct control over their employees’ health benefits. But those potential benefits are already limited and will shrink even more as the gig economy grows.

Driving the news: Amazon is looking to open primary care clinics at its Seattle headquarters, CNBC reported last week. It's a possible experiment in Amazon’s joint effort, along with Berkshire Hathaway and JPMorgan Chase, to bring down health care costs.

  • Apple is also staffing up health clinics for its employees.

By the numbers: Only about 5% of all businesses offer an onsite clinic, according to the Kaiser Family Foundation. But among businesses with at least 5,000 workers, that number climbs to 32%.

“It is a trend. It’s not giving up on the health care system, but it’s saying, ‘We think there are some things we can better manage,” said Jeff Dobro, who leads clinical services at Mercer, a consulting firm that works on employer health benefits.

Most onsite clinics provide services related to workers' jobs, but a growing number also offer some limited set of primary-care services, according to Mercer.

  • Onsite clinics are a way to move relatively cheap, easy procedures — things like flu shots, screenings and urgent care — onto the corporate campus, but employees who have access to one still have to rely on their insurance plan and its provider network for major services like hospitalizations.

Another, more aggressive option for large employers is to bypass the traditional insurance structure and contract directly with one health care provider.

  • General Motors announced such a deal last week, partnering with a Detroit-area hospital system (the Henry Ford Health System, ironically enough) for all of its salaried employees’ care.
  • Walmart, Disney and Boeing also use direct-purchasing agreements for at least some of their employees’ benefits, according to the Wall Street Journal.

Nether model is new — employer-sponsored health clinics date all the way back to coal mining companies that needed a healthier workforce, Dobro said, and direct purchasing also has been around for decades.

Neither exerts much pressure on the rest of the health care market, either.

  • They’re both tools to pull back from the standard insurance system, at least partially. Employers who set up onsite clinics or direct purchasing agreements aren’t using their purchasing power to drive generalized value or shift the system’s incentives. Whatever savings or efficiencies they reap are theirs alone; they don’t trickle down to other patients with other forms of coverage.
  • And both are only feasible for large employers. They need a critical mass of workers, all in one place, to justify the cost of operating a clinic or to strike a good deal with a single provider.

Fewer and fewer people work directly for a large company. And if you don’t, “you’re left to your own resources out there,” Dobro said.

Go deeper

The hard math behind America's labor shortage

Data: Bureau of Labor Statistics, Congressional Budget Office; Chart: Axios Visuals

Yes, the pandemic has created unusual temporary labor market dynamics. But in the bigger picture, the 2010s were a golden age for companies seeking cheap labor. The 2020s are not.

The big picture: In the 2010s, the massive millennial generation was entering the workforce, the massive baby bo0m generation was still hard at work, and there was a multi-year hangover from the deep recession caused by the global financial crisis.

Advocates fret Roe v. Wade's 49th anniversary could be its last

Photo: Leigh Vogel/Getty Images for Women's March Inc

As Saturday marks the 49th anniversary of Roe v. Wade, the Supreme Court's landmark decision that legalized abortion access in the U.S., advocates warn the ruling is "more at risk now than ever."

The big picture: The Supreme Court in December heard a challenge to a Mississippi 15-week abortion ban that could throw Roe's survival into question, or at least narrow its scope.

Updated 14 hours ago - Politics & Policy

Omicron dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Pfizer and Moderna boosters overwhelmingly prevent Omicron hospitalizations, CDC finds — Omicron pushes COVID deaths toward 2,000 per day — The pandemic-proof health care giant.
  2. Vaccines: The case for Operation Warp Speed 2.0 — Starbucks drops worker vaccine or test requirement after SCOTUS ruling — Kids' COVID vaccination rates are particularly low in rural America.
  3. Politics: Biden concedes U.S. should have done more testing — Arizona says it "will not be intimidated" by Biden on anti-mask school policies — Federal judge blocks Biden's vaccine mandate for federal workers.
  4. World: American Airlines flight to London forced to turn around over mask dispute — WHO: COVID health emergency could end this year — Greece imposes vaccine mandate for people 60 and older — Austria approves COVID vaccine mandate for adults.
  5. Variant tracker