Magazine article HRMagazine

Fit for an On-Site Clinic

Magazine article HRMagazine

Fit for an On-Site Clinic

Article excerpt

On-site clinics are one solution to rising health care costs.

As executives look for ways to manage rising health care costs and absenteeism and to hike productivity, some employers are looking to on-site health care clinics as a solution. On-site clinics aren't new, but they have evolved to serve a different purpose. Historically, on-site clinics were largely used in the manufacturing and mining industries to deal with occupational injuries, as well as to treat minor illnesses and conditions.

Today's on-site clinics are far broader in the scope of services provided. They are not limited to treatment of job injuries or minor conditions. Instead, an employee may be able to receive comprehensive health care services, very similar to what is expected during a visit to a primary care physician or even an urgent care center or emergency room.

These clinics are intended to provide cost savings to the employer as well as complement the employer's wellness, disease management and preventive care programs. A 2010 study funded by the Robert Wood Johnson Foundation explains, "By far the strongest motivation for implementing workplace clinics is to contain direct medical costs. In the short term, exerting greater control over direct costs, such as specialist visits, nongeneric prescriptions, emergency department visits and avoidable hospitalizations, is a key employer objective." To achieve greater savings, employers are often providing spouses and dependent children access to the clinics, at little or no cost to the employee.

Key Decisions

An employer's decision to build an onsite center is only the beginning. Once business leaders have made that choice, they need to deal with some important decisions:

* Will the clinic be accessible only by employees, or will spouses, dependents and retirees also be able to use it?

* Will the clinic provide care only for occupational injuries or for a wider range of ailments? In keeping with the interest in wellness, the trend appears to be toward broader coverage.

* Will the employee pay all charges for services at the clinic, or will some or all charges be covered by the employee health plan?

* Will staffing be available at the clinic-physicians, nurse practitioners and physician assistants? Depending on state law, physician oversight may be required.

* Will the clinic be built as a separate facility, will the employer lease space or share space with another employer, or will it be located in a mobile unit? What privacy concerns, if any, would accompany that decision?

* Will the employer incur costs to build the clinic and maintain it?

* Will the employer measure return on investment (ROI)? The 2010 Robert Wood Johnson Foundation study notes that there are two principal ways to measure ROI-a "hard ROI" that measures savings in direct medical costs only, and a "soft ROI" that includes productivity gains from other factors, such as reduced absenteeism.

* Who will manage the clinic and be responsible for managing risk and maintaining compliance with appropriate laws and regulations, including medical privacy? While an employer may selfmanage or hire a medical provider to manage the clinic, most employers have engaged third-party vendors to manage clinic operations and regulatory compliance.

Not for Everyone

On-site clinics are not necessarily right for every employer. As a rule of thumb, an on-site clinic is most likely appropriate for employers with at least 1,000 employees. However, the size of the employer is not the sole determining factor.

Depending on the employer's objectives, an employer with high rates of absenteeism due to illness, low rates of utilization of preventive care services and long employee commutes for medical care may benefit from an on-site clinic. In addition, an on-site clinic may prove to be a necessary component for an employer's ongoing wellness and disease management programs, helping to manage health care costs and improve long-term employee health. …

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