Scottsdale City Council may have quietly launched a city health clinic.<\/p>\n
Or did it?<\/p>\n
Though a budget including a space for a clinic and startup costs was approved by City Council, the city manager\u2019s office responded to questions from the Progress by saying nothing is certain.<\/p>\n
The concept of an employee health clinic is somewhat murky: Though Scottsdale\u2019s elected representatives authorized money for it, no public presentation was made at City Council meetings.<\/p>\n
At its June 9 meeting, Scottsdale\u2019s elected officials approved two dozen \u201cconsent agenda\u201d items, including liquor licenses, the Terawatt charging center and 350 additional \u201cresidential units\u201d at the landscape-shattering One Scottsdale development.<\/p>\n
While Councilwoman Solange Whitehead asked for an item related to Human Resources to be \u201cpulled\u201d for discussion and a separate vote, the other 22 consent agenda items were voted on as a group, with no presentations or explanations.<\/p>\n
The approved items included:<\/p>\n
\u201cPurchase Agreement with Scottsdale Unified School District No. 48.\u201d<\/p>\n
This, according to a staff report attached to the consent agenda, was for \u201cthe purchase of a 13,138 square foot office building located at 7575 E. Main Street for $3.7 million.\u201d<\/p>\n
Later in the June 9 meeting, City Council unanimously approved a proposed $2.1 billion budget.<\/p>\n
The Progress asked a city spokeswoman if the SUSD building purchase was included in that budget.<\/p>\n
\u201cYes,\u201d Holly Peralta answered. \u201cIt was included on page 427\/G-258 of the proposed budget.\u201d<\/p>\n
She provided a screen shot of the page, which outlines:<\/p>\n
\u201cFacility Acquisition for Employee Health Clinic and Office Space (New Capital Project 40)\u201d with an estimated completion of June 30, 2027.<\/p>\n
The address is the same, 7575 E Main St. \u2013 but the project is described as:<\/p>\n
\u201cPurchase and convert a facility building to implement a nearby city employee health clinic.\u00a0<\/p>\n
\u201cThe city recognized the health clinic as an opportunity to reduce health related claims and enhance access to healthcare for city employees and improve employee well-being\u2026\u201d<\/p>\n
The information related to the June 9 City Council vote makes no mention of a clinic, however.<\/p>\n
The agenda report states the $3.7 million is \u201cfor the purchase of real property for use as office and workspace for municipal employees.\u201d<\/p>\n
Under \u201cmaintenance requirements,\u201d there is no mention of a renovation\/conversion.<\/p>\n
Instead, according to the report and recommendation City Council approved, \u201cThe property is in good condition, requiring minimal maintenance and office modifications before it can be utilized by Scottsdale employees as office space.\u201d<\/p>\n
The \u201cbackground\u201d section provides a brief history lesson, while reiterating the proposed use:<\/p>\n
\u201cThe property will primarily be utilized by the city\u2019s Human Resources (HR) department and is ideally located near the city\u2019s Scottsdale Civic Center, which is a central location for many city<\/p>\n
operations.<\/p>\n
\u201cThe City of Scottsdale previously owned the 7575 building and the city\u2019s Human Resources department operated out of the space. The city later sold the building to Scottsdale Unified<\/p>\n
School District.\u00a0<\/p>\n
\u201cThe city desires to acquire the property back to meet current office and employee training space needs.\u201d<\/p>\n
In an April 16 presentation to the Budget Review Commission, City Manager Greg Caton unveiled an intriguing slide:<\/p>\n
\u201cImplementation of a new employee clinic $1.75M.\u201d<\/p>\n
When the Progress asked for details on this two months ago, Peralta replied, \u201cThe clinic is still in the planning phase and would require City Council approval as part of the FY 2026\/27 budget.<\/p>\n
\u201cIf approved,\u201d she continued, \u201cimplementation is anticipated in the next fiscal year. The clinic would be located at or near a city facility, but a final site has not yet been selected.\u201d<\/p>\n
Peralta said the city hired a healthcare consulting firm to complete a feasibility study using actual claims data. \u201cThe study found Scottsdale is a strong candidate for a clinic, with projected net savings exceeding costs within two to three years,\u201d Peralta said.<\/p>\n
The $1.75 million, she added, \u201cis a first-year estimate that includes clinic build-out, implementation and startup costs, along with initial operating expenses such as staffing, supplies and administration.\u201d<\/p>\n
Though it must still be finalized at a June 23 public hearing, City Council approved Caton\u2019s proposed budget \u2013 with no requested revisions.<\/p>\n
The \u201cEmployee Health Clinic\u201d page lists a total of $4.7 million.<\/p>\n
\u00a0<\/p>\n
Candidates\u2019 feedback<\/strong><\/p>\n In April, the Progress asked City Council candidates \u2013 including the two representatives running for reelection \u2013 if they support the idea of a clinic.<\/p>\n Councilman Barry Graham: \u201cA well-designed, on-site employee health clinic fits with the city’s self-insurance strategy. Many large organizations\u2014including publicly traded companies\u2014are already doing this.\u00a0<\/p>\n \u201cSince the City of Scottsdale self-insures, this pilot program can help improve the quality of healthcare for employees while getting ahead of rising healthcare costs borne by taxpayers. It\u2019s the kind of program I intend to monitor closely for its return on investment and employee utilization rates.\u201d<\/p>\n Councilwoman Solange Whitehead: \u201cNo resident (or employee) has asked me to spend tax dollars on a city employee health clinic. Our residents want secure water, safe neighborhoods, fiscal discipline and city leaders that put residents first.\u201d<\/p>\n Ethan Knowlden: \u201cDon\u2019t have enough information on the clinic to offer a comment.\u201d<\/p>\n Raoul Zubia: \u201cI support investing $1.7 million in a new employee clinic because it\u2019s a practical way to control long-term healthcare costs and improve access to care. It reduces insurance claims, boosts productivity, and emphasizes prevention. It is a smart step toward strengthening the self-insurance fund and supporting a healthier workforce.”<\/p>\n Bob Littlefield: \u201cRight now I am a \u2018no\u2019 on the \u2018new employee clinic.\u2019 I am not convinced it would be cost-effective or produce better health outcomes.\u00a0<\/p>\n \u201cBut Caton is still tweaking this proposal so we will see what he comes up with.\u201d<\/p>\n Crystal Carroll, Michelle Ugenti-Rita and Eric Sloan did not comment on the proposed employee clinic.<\/p>\n \u00a0<\/p>\n Questions<\/strong><\/p>\n After the vote on the budget, the candidates were asked to update their thoughts on the clinic.<\/p>\n Most did not respond.<\/p>\n Bob Littlefield\u2019s updated response: \u201cI\u2019m still not convinced it is a good idea.\u201d<\/p>\n Graham forwarded an email he sent to Caton: \u201cGreg, I’m receiving questions about the health clinic and our plans for the new Main Street office \u2026\u201d<\/p>\n Caton\u2019s response:<\/p>\n \u201cThe purchase of 7575 Main<\/p>\n \u201cWe plan to move Human Resources back to this building. Human Resources was there years ago when we owned the building. The building is centrally located, so it will serve our organization very well. We are still exploring other functions to go in the facility \u2026 however, there may be space for the Employee Clinic, but we also need to see if our vendor (after an RFP) believes this space will work.\u201d<\/p>\n Regarding the employee health clinic, Caton referred to an earlier memo with a feasibility study.\u00a0<\/p>\n \u201cThe study showed that we can reduce claim costs by having the facility,\u201d Caton stated.\u00a0<\/p>\n \u201cMany large employers are self-funded, which we are. This means that any investment in programs that drive down claims will benefit the city \u2013 because we pay claims. So, when we have less claims, we benefit from this. I have implemented facilities like this in my two previous organizations, and they do put downward pressure on claims. Locally, the cities of Mesa and Phoenix have these facilities.\u201d<\/p>\n Caton noted \u201ca primary objective is cost containment for our health insurance costs \u2026\u00a0<\/p>\n \u201cWe cover about 5,000 people on our plan and unfortunately many people don\u2019t have primary care physicians, or can\u2019t get in, so they end up in the emergency room, and this drives up claims. This facility will help provide access and get people on a wellness journey instead of sick care.\u201d<\/p>\n Responding to a request for clarification from the Progress, Peralta stated:<\/p>\n \u201cThe original Capital Improvement Plan project title included \u2018Employee Health Clinic and Office Space\u2019 because one of the concepts being evaluated at the time was the potential use of a portion of the facility for an employee health clinic.<\/p>\n \u201cAs discussions progressed, it became clear that the ultimate use of the building had not been finalized. As a result, the final capital project title will not include verbiage related to the Employee Health Clinic.\u201d<\/p>\n She echoed Caton in noting \u201can employee health clinic remains one of several potential uses being evaluated for the facility, depending on space needs and the results of an upcoming RFP process.\u201d<\/p>\n What City Council\u2019s June 9 budget vote authorized remains vague, if not confusing.<\/p>\n Though the purchase of the building and CIP budget line both state an employee health clinic will be at 7575 E Main St., Caton and Peralta insist nothing is concrete.<\/p>\n \u201cWhile the proposed FY 2026\/27 budget includes funding for the employee health clinic concept, no final decision has been made regarding whether a clinic will ultimately be in this (7575 E Main St.) facility,\u201d Peralta said.<\/p>\n The spokeswoman for the city manager\u2019s office acknowledged Caton has not made a presentation on the proposed employee health clinic to City Council.<\/p>\n Peralta noted \u201cthe building acquisition and related CIP funding were presented publicly through the city’s budget and capital improvement planning process\u201d and discussed during Budget Review Commission meetings \u201cand through a City Council memorandum.\u00a0<\/p>\n \u201cHowever, City Council has not been asked to approve a final plan establishing an employee health clinic at this location because no such final proposal has been developed or presented.\u201d<\/p>\n And yet, she acknowledged:<\/p>\n \u201cThe proposed FY 2026\/27 budget includes approximately $1.7 million related to the employee health clinic concept.\u201d<\/p>\n That recently-approved budget \u201cincludes funding associated with establishing space, furnishings, fixtures and equipment.\u201d<\/p>\n \u2018Plant fund\u2019<\/strong><\/p>\n The cash-strapped Scottsdale Unified School District \u2013 with two schools closing and more on the way \u2013 can certainly use money.<\/p>\n The Progress asked SUSD how it can use the $3.7 million generated from the sale of the office to the city.<\/p>\n \u201cThe proceeds from the sale are deposited into the \u2018plant fund\u2019 and can only be used for capital expenses and not personnel,\u201d SUSD Superintendent Scott Menzel answered.<\/p>\n \u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"Scottsdale City Council may have quietly launched a city health clinic. 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