Panelists Discuss Strategies to Build Bottom Line

The following is excerpted from a panel discussion held during RYAN Associates’ 2009 National Conference. The topic was Repositioning to Build Your Organization’s Bottom Line.

The panelists:

  • Barry Adelman, Chief Operating Officer, Central Valley Occupational, Bakersfield, Calif.
  • Douglas Benner, M.D., Occupational Health Coordinator, Kaiser Permanente, Oakland, Calif.
  • Pamela Hymel, M.D., Corporate Medical Director, Cisco Systems, San Jose, Calif., and President, American College of Occupational and Environmental Medicine
  • Frank Leone, President and CEO, RYAN Associates, who also served as moderator, Santa Barbara, Calif.
  • Penny Nichols, Director, Regional Growth and Sales, Sutter Health, Sacramento, Calif.

Q: What specific actions should occupational health professionals be taking now to help provider-based programs recover quickly from the recession?

Dr. Hymel: Evaluate your customer base. Look at the type and size of the companies you are serving and talk to them about onsite services. Consider how you could augment occupational
medicine with urgent care or primary care. Also, begin to develop a bridge to total workplace health.

Dr. Benner: Use the American College of Occupational and Environmental Medicine’s online Health and Productivity Management Toolkit to determine how to provide employers and your community with health risk assessments (HRAs). Ask employers, “What are you spending on health care?” because it is a growing percentage of their cost structure. With an HRA you can help them assess nomically in the best interest of our parent institution and addressing the health care needs of the populations that we serve. I see women’s health as the next great horizon for occupational health. The real way to grow women’s health is to use the workplace as an educational platform to make more women understand the vast array of services that are available to them, generating demand for annual exams, which in turn results in a significant number of screenings and procedures.

Dr. Benner: Wellness products that you can offer to your workforce or your community. Services that could cross over to minor injury or minor urgent care/group health-type services also would be useful.

Q: At the risk of sounding cynical, it doesn’t pay for us to provide wellness and prevention services. It has been a mantra for a long time, but how does this industry make money on that?

Mr. Adelman: I agree. It’s a tough marketplace. But there are services out there, for example, in ergonomics, in safety, where I have done a cost-plus reimbursement structure and factored in
a 25 percent profit margin.

Mr. Leone: The more that you isolate prevention and make it a discrete concept the harder it is going to be. The more that prevention is incorporated in a systematic approach to workplace
health and safety, the more logical it becomes and the more it fits in.

Dr. Hymel: That is where I see the group health side coming in. In our (onsite) health center, we bill back to group health for a lot of the preventive services we provide. The plan covers biometric screening and physical exams, so that is not something the employer is paying out of pocket. For the private practitioner, it is a way to generate revenue.

Ms. Nichols: When we offer onsite services, the idea is to screen things out early. But we will
find some conditions that need further intervention, and that is a revenue generator for the entire health system.

Q: Regarding providing both primary care and occupational health to a company, do you see the potential for a conflict of interest?

Dr. Hymel: I don’t. Many employers are putting those models into effect now. As long as you keep in mind confidentiality around personal health, you can pull it off pretty seamlessly.

Dr. Benner: At the provider level, you can know everything. But you have to be careful not to
report personal health issues to the insurance carrier unless you have discussed it with the patient and it’s only relevant to their claim. You have to be careful not to share information with the wrong parties.

Q: In your opinion, what is the most significant “Achilles’ heel” for provider-based occupational health programs? What suggestions do you have for overcoming those limitations?

Ms. Nichols: Medical provider networks (MPN) have been a challenge for us in California. The bottom line, we have reached out to big employers to get on their MPN lists to become a provider of choice.

Mr. Adelman: There is a growing separation between providers, employers, and the payer community. We have taken steps to get closer to employers and claims administrators, but we don’t blanketly accept payer discounts. We have re-negotiated contracts at fee schedule or something higher than a steep discount for the provision of services.

Dr. Benner: In California, the limitation is a wacky reimbursement system in which surgeons get paid more than primary occupational medicine physicians. One way to address that is through the development of smaller provider networks that demonstrate quality and the value of individual providers in the network.

Dr. Hymel: In industry, sometimes occupational health is run by risk management, and often they don’t interact with human resources. So, it is essential to bring in human resource and disability managers to begin conversations in the wellness area.

Mr. Leone: There is a vast tie for second place on this: Poor communication; less-than-optimal sales and marketing; staff mix and expense that is often an albatross; inappropriate allocation of corporate overhead to programs that make it impossible to show a bottom-line profit; lack of demand or declining employer willingness to spend money on discretionary services. But the 500-pound elephant in the room is institutional politics – silo mentalities, turf protectionism. The best way to minimize that is to clearly articulate the mission and value of occupational health and make sure all stakeholders understand it is good for the organization as a whole.

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