The Herman Trend Alert|
August 23, 2006
Onsite Clinics Reduce Healthcare Costs
As employers look for ways to further reduce healthcare costs, one strategy that is growing in acceptance is the establishment of onsite medical clinics According to a study by the consulting firm Watson Wyatt, 33 percent of the 275 organizations that collectively employ more than 4.9 million workers have set up onsite medical clinics or plan to sometime this year.
Implementing this concept afford benefits to both employers and their workers. First, onsite clinics deliver greater access to care at lower costs. Because the clinics are on site, they are accessible to the employees---they don't have to leave to go to the doctor; they are less likely to put off the doctor's visit that may detect a serious problem which may now be caught early.
Second, onsite clinics address employees' overall health issues. Workers don't have to go to different doctors to receive basic medical care. In addition, onsite clinics provide the organization an opportunity to counsel high-risk employees on their vulnerability for disease and help them address their issues appropriately to minimize their discomfort and cost.
Onsite clinics can provide risk management on workplace safety by reinforcing the messages delivered in safety training. Moreover, in the event of worksite accidents, having an onsite clinic means that the company can provide on-the-job treatment of injuries and assessment of illnesses.
Lowe's, a Mooresville, NC-based home improvement retailer, covers 195,000 workers and their families with an annual expenditure of about $600 million per year on health insurance. By combining several strategies, Lowe's saved $16 million on health benefits. Some of the strategies they implemented included having no co-pay for generic medicines, installing four onsite health clinics, and giving workers an incentive to complete a health risk assessment.
The company has significantly improved its bottom line without reducing benefit levels for workers. As a result of these initiatives, Lowe's has had premium increases of only 5 or 6 percent for the last three years, which was lower than the 8 to 9 percent national average for employers.
Expect to see more onsite clinics popping up at employers' sites throughout North America.
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