Human Resources: Companies Not Fully Tapping Potential of Onsite Health Centers

WASHINGTON, D.C., March 19, 2008 – High health costs and a renewed focus on
worker productivity have led an increasing number of companies to open
onsite health centers in recent years. However, few companies fully tap the
potential of these centers, according to Watson Wyatt, a leading global
consulting firm.

Nearly one-third of companies (29 percent) have or plan to have an onsite
health center by 2009, up from 27 percent in 2006, according to Watson
Wyatt/National Business Group on Health research. A separate Watson Wyatt
study of 84 companies with onsite health care centers found that reducing
medical costs was the chief reason 70 percent of companies have opened a
center since 2000 (recent adopters). Only 49 percent of companies that
adopted health centers before 2000 (early adopters) did so due to cost.
More early adopters (54 percent) opened a center to address occupational
health.

“Although their primary motivation may be changing, more employers are
operating onsite health centers as part of their overall health and
productivity strategy,” said Marne Bell, senior health care consultant for
Watson Wyatt. “Yet, surprisingly many do not have a good handle on whether
these centers are producing the desired return on investment.”

Nearly half (45 percent) of companies cite inadequate measures of
performance as the top challenge in operating the centers. Integration of
the health center with a company’s other health and productivity
initiatives and data also remains a challenge.

Measurement is the top challenge for companies with onsite health centers

Challenge Employers cite among top challenges (%)
Inadequate measures of performance 45%
Less than ideal location 23%
Lack of integration with health and productivity programs 19%
Lack of integration with local medical providers 17%
Lower than expected utilization 17%
Higher utilization for “self care” 10%
No challenges indicated 26%

Most companies do not link their data to medical claims (41 percent of
recent adopters and 58 percent of early adopters). Nearly one-fifth do not
store their data electronically (19 percent of recent adopters and 16
percent of early adopters). Further, only 39 percent of companies integrate
disease management programs with their onsite health centers and only 30
percent connect them with a nursing hotline.

“As onsite health center services grow more comprehensive, linking the
center with a company’s full range of health and productivity initiatives
promotes more efficient care management and can create a competitive
advantage,” said Bell.

Other findings:

Preventive services such as immunizations and screenings are the most
common offering among recent adopters of onsite health centers (81
percent). Mental health counseling is more than three times as common among
early adopters (46 versus 15 percent). Physical therapy is twice as
prevalent among early adopters (44 percent versus 22 percent). However,
recent adopters are nearly twice as likely as early adopters to offer
pharmacy benefits (44 percent versus 23 percent).

Nearly all (96 percent) of employers make onsite health center services
available to employees enrolled in their health plan. Nearly three-quarters
(71 percent) of companies provide services to part-time employees, even
those not eligible to participate in the health plan. Only 25 percent of
organizations offer clinic services to covered dependents and just
one-fifth (20 percent) of retirees are offered access to the center.

More information on the 2007/2008 Onsite Health Center Survey of 84 large
companies is available at http://www.watsonwyatt.com/onsitehealthcenters.

About Watson Wyatt Worldwide

Watson Wyatt (NYSE, NASDAQ: WW) is the trusted business partner to the
world’s leading organizations on people and financial issues. The firm’s
global services include: managing the cost and effectiveness of employee
benefit programs; developing attraction, retention and reward strategies;
advising pension plan sponsors and other institutions on optimal investment
strategies; providing strategic and financial advice to insurance and
financial services companies; and delivering related technology,
outsourcing and data services. Watson Wyatt has 7,000 associates in 32
countries and is located on the Web at www.watsonwyatt.com.