“We know that one of the primary drivers of improved productivity is financial accountability for results,” says Jim Koskan, corporate direc- tor of risk control. “Every profit center is responsible for the cost of employee injuries, and we review these numbers monthly.” In an industry with razor-thin margins, excessive injury costs can have a substantial impact on financial results.
The retail food industry is the largest employer in the entire retail sector, and the most dangerous. The supermarket injury incidence rate of 6.5 per 100 equi- valent full-time employees for 2006 is a full 2 points higher than the rate for all private industry. But with comprehensive safety programs in place, SuperValu has achieved injury rate reductions ranging from the high single digits to the low teens every year for the past five years, and now has rates that are consistently below the industry average.
The company has also slashed the cost of the injuries. Ten years ago, SuperValu installed on-site clinics in its distribution centers and then outsourced the project to Medcor Inc., which provides both on-site clinics and on-call 24/7 triage services to a wide range of companies.
“When we saw the results of the on-call services, we decided that it made sense for all locations that couldn’t support a full on-site clinic,” Koskan says. SuperValu is now completing the on-call rollout to all 2,500 retail stores.
“With the on-call tool, we can track how many calls result in referrals to physicians and how many lead to treatment at the facility, which we call ‘saves,’ ” Koskan says. The percentage of injuries now treated on site ranges from 20 percent at some facilities up to 60 percent at others.
Across all 30,000 work sites that now use Medcor’s on-call service, 50 percent of injuries are treated on site, according to the company. Cost savings come from the reduction in the number of physician visits, which translates directly into reduced workers’ compensation claims.
Injured workers speak directly with a registered nurse, who uses proprietary software and clinical protocols to determine if the injury can and should be treated on site. All calls are logged and recorded. Medcor adds clients as additional insureds on its malpractice policies. “Many clients hire us because they are interested in risk shifting,” says Curtis Smith, Medcor’s vice president.
On-site clinics also produce significant savings. The smallest staffed on-site clinic costs $200,000 on average, including the cost of space and supplies, and should reduce claims by 50 percent to 75 percent, according to Smith. “The point is not to build the most comprehensive clinic, but to build a lean clinic that can deliver the best value,” he says. “To find the sweet spot, you have to know the costs and determine what is the least amount of program that will achieve results.”
Substantial savings occur downstream as claims decline. “But the most sophisticated buyers look beyond claims reduction to recruiting, retention, productivity and a net decrease in all heath care costs,” Smith notes. “Across all industries, any site with more than 1,000 employees will see cost savings from an on-site clinic. In low-injury environments such as white-collar sites, the savings come from greater wellness and prevention efforts, such as on-site strep tests and flu shots and monitoring preventive testing.”
Workforce Management, February 18, 2008, p. 23 -- Subscribe Now!