City of Marion

Overall, we were able to save $2.7 million last year through the program ELAP helped us build

Problem

In 2012, the City of Marion faced a $5.2 million dollar deficit, in large part due to rising healthcare costs they couldn’t contain. They had to deplete their cash reserves to nearly nothing just to pay the bills. As a result, their Standard & Poor bond rating was dropped to bbb-.

“In 2012 we had all the wheels fall off — almost $6 million in healthcare costs — we were seeing a horrible trend”

ELAP Solution

Faced with the threat of another crippling fiscal year, the Mayor decided to explore innovative ways to control the city’s healthcare costs. When he connected with ELAP, the solution presented itself: a system where employer costs were based on the actual cost of service to the provider, not the wildly inflated billed charges.

With ELAP, the city was able to bring the same fiscal discipline they have in all other areas of their governance to the healthcare space. ELAP audited every claim over $2,500, line by line, and adjusted the claim accordingly to the actual cost of the service plus a reasonable profit. ELAP was also able to negotiate an agreement with a local hospital to provide care for the city employees.

Outcome

The transformative change in the City of Marion in 2013 is one rarely seen today in a climate of tight budgets and increasing costs. Not only did Marion save substantial dollars on their healthcare costs, they were also able to rebuild their depleted cash reserves and re-invest some of the money back into their employees. Standard & Poor noticed this incredible change and upgraded their bond rating from a bbb- to A- after just one year with ELAP.

“ELAP beat our expectations. They exceeded what we thought could happen, and got us out of our hole a lot quicker than anticipated”