A Michigan School District Buys Primary Care for 255 Employees. Its Health Plan Covers 110.
Corunna Public Schools pays for primary care for all 255 of its employees. About 110 of them carry the district’s health insurance.
That gap is the most interesting number in Robin Erb’s reporting for Bridge Michigan on three Michigan districts that have put direct primary care into their benefits. The district’s insurance roster and its primary care roster are different populations, and because Corunna buys primary care for everyone on payroll, the second runs more than twice the size of the first.
Corunna sits northeast of Lansing. Just over two years ago it began paying $90 a month per employee to Plum Health, a Detroit direct primary care practice, for a two-day-a-week clinic built into converted classrooms on the district’s main campus. Lansing and Van Buren districts are in the same consortium.
What $90 a month actually buys
On a recent clinic day, physician assistant Shelley Littleton had 13 patients on the schedule. Poison ivy, pink eye, warts, high blood pressure, high anxiety, and a case of cellulitis that had already sent someone to an emergency room. Every visit was booked for at least half an hour. The two new patients got a full hour.
Those 13 people walked out with close to $550 worth of medication and paid nothing for any of it, and nothing for the visit either. No copay, no deductible.
The district picks up the drug cost. Plum buys in bulk and bills the schools a 15% markup on top, which founder Dr. Paul Thomas describes as “pennies a pill.” Physician dispensing rules vary by state, and physicians are responsible for verifying what their own state requires. DPC Frontier tracks the differences.
One patient called at 8 a.m., took a slot an hour later, and was back out the door at 9:27 with his prescription in hand.
The bet the district is making
Twelve months at $90 a head for 255 people comes to roughly $275,000, about $1,080 per employee. That is this publication’s arithmetic rather than a district disclosure. Bridge reports the monthly rate and the headcount and no annual figure, and not every school payroll runs twelve months.
Set that against what employers are staring at. Aon projects that U.S. employer health care costs will climb 9.5% in 2027, pushing average spend above $19,000 per employee, driven largely by high-priced drugs and heavier use of the medical system. Employees themselves are on track to spend close to $5,300 this year between payroll premiums and out-of-pocket costs.
The districts’ case is avoidance. They expect easy-access primary care to cut trips to the emergency room, where a visit can easily top $1,000. One family passing strep around the house in the middle of the night can run the district’s insurance pool hundreds, if not thousands, of dollars. About 110 staff carry coverage through the Michigan Education Special Services Association. Repeat the pattern across hundreds of families and the year’s claims experience is set.
Here is what the reporting does not contain. After two years of the program, Bridge published no before-and-after figure on what Corunna actually spends on health benefits. That number exists somewhere in the district’s books, and the story about the clinic runs without it. The avoidance argument is clean arithmetic on any single emergency room visit and an untested claim at the level of a whole benefits budget, and those are two different things.
The district bought placement, not a discount
Plum’s retail rate at its Detroit and Royal Oak offices is $95 a month for around-the-clock access to family medicine. Corunna pays $90. Rates vary by practice and location, but a five percent spread tells you the district was not shopping on price.
It was buying where the clinic sits. The exam rooms are converted classrooms on the district’s main campus, cement block rooms where a decades-old pencil sharpener still hangs on the wall.
It was also buying reach that the health plan cannot deliver. Part-time food service workers and paraprofessionals might be on a spouse’s plan, might be shopping the individual market, might have nothing. Bridge reports the cost to see Littleton is the same either way. In a state short of teachers, superintendent John Fattal frames the whole arrangement plainly: “We see this as a recruitment and retention tool.”
Littleton is her own argument for the reach. She does not carry regular coverage. At 56 she was quoted $650 a month against a $10,000 out-of-pocket maximum, ran the numbers, and decided she would never see real benefit from it. She holds a catastrophic rider instead. “I really understand the insurance runaround because I am the poster child,” she said.
She has company. Nearly 131,000 Michiganders dropped federal marketplace coverage this year, and more than 80,000 people have dropped off the state’s safety net programs since January as Medicaid shrinks.
The tension the model lives inside
The 2024 American Academy of Family Physicians survey Bridge cites puts direct primary care panels at just over 400 patients. Conventional primary care panels get quoted around 2,500, a figure Bridge notes some have argued is unrealistically high.
Every physician who moves into DPC sheds hundreds of patients. Those patients need somewhere to go, in a state where nearly 1 in 3 residents already lack primary care access and where roughly 5% of health care dollars flow to primary care against the 12% to 15% that experts say a working system requires.
Thomas answers on a longer clock. Small panels and a livable schedule keep today’s primary care doctors from burning out early, and give tomorrow’s residents a reason to choose the specialty at all. He might be right. It would take a decade of match data to know.
Both halves hold at the same time. The Corunna clinic works because 400 patients can get thirty minutes and 2,500 patients cannot. Running that same arithmetic across a state where a third of people already cannot find a doctor is a harder problem, and 255 school employees in Shiawassee County are not the ones who have to solve it.