A buyer’s guide to occupational health

To remain competitive, occupational healthcare providers have had to widen their scope, as employers increasingly look to demonstrate a return on their investment, says Nick Golding

Occupational health products must constantly evolve if they are to continue to meet the demands of the UK workforce. Employee wellbeing and preventative health schemes have become particularly popular among both employers and staff, so occupational health providers have found it necessary to adapt to cater for this demand.

They have been forced to develop services that cover all aspects of employees’ health such as health screening, wellbeing support and sickness absence management systems to add to their core products focused on health and safety.

Historically, occupational health was seen as a rather narrow provision for employees working in conditions that exposed them, for example, to loud noises or dangerous chemicals. Dudley Lusted, head of corporate healthcare development at Axa PPP Healthcare, explains: “In the past, it was very much about health surveillance around workers who could turn deaf at work, for instance, but now it is about keeping all people as fit as possible at work so they can perform at their optimum [level].”

In its early forms, occupational health was confined largely to blue-collar manual workers, but increasing awareness of issues such as stress among office workers has resulted in occupational health altering its profile to incorporate solutions for mental health problems, rather than just musculo-skeletal problems such as back pain.

Dr Jenny Lesser, clinical director, occupational health at Bupa, says: “I think mental health issues are starting to overtake musculo-skeletal in terms of [causes of] common occupational [illness].”

Education has also become a more important feature of occupational health schemes, and providers are increasingly being invited into workplaces to help improve understanding among both employers and employees about how to remain healthy at work.

Mike Goldsmith, chairman of the Commercial Occupational Health Providers Association (Cohpa), explains: “There is an education process. We spend a lot of time helping employees understand [their] health.”

Passing back to employees responsibility for their own health, for example, by advising them about issues rather than forcing action upon them, can also impact on key employment measures such as employee engagement. Enabling staff to make their own decisions around their health by providing them with the necessary education to do so can be a key way of helping to boost engagement levels.

“Employers want to be employers of choice, and this comes down to wanting to fully engage people [around health]. Engagement is a big HR buzzword these days,” says Lusted.

Yet, as occupational health schemes become more versatile in terms of what they can offer, employers are likely to find that the cost of providing these types of products will increase.

More often than not, providers are seeing finance directors becoming involved in helping HR to implement occupational health schemes, because the increasing costs are often difficult to justify. Alex Marshall, national sales manager, occupational health at Norwich Union Healthcare, explains: “Something that we are consistently being asked is about the return on investment. Organisations want to know what they are getting back on their spend, especially the finance director who wants to know how much it will save the [organisation].”

Proving a solid return on investment on occupational health products is one of the biggest challenges that the industry currently faces. Although it is hoped that some form of measuring tool will be introduced over the next few years, it is currently very difficult to prove that occupational health can be a money saver.

However, providers are adamant that a good occupational health scheme can have a positive effect on an organisation’s balance sheet. Derek Warren, sales and marketing director at Grosvenor Health, says: “HR is being challenged to demonstrate its worth to an organisation and this is an area where HR can score some points. An HR department working with a good occupational health provider can pay for itself ten times over.”

Looking to the future, it appears that occupational health products will have to continue to change alongside the needs of employees. One particular feature of these products that is expected to grow at a fast pace is the use of technology.

Online pre-employment questionnaires and online absence management programmes, for example, have both become increasingly popular, and according to providers in the market, employers’ enthusiasm for such systems is not likely to fall away in the foreseeable future.

“Technology and web-based services will continue to be a focus in the future, because they simply enhance the service that we can give to our client,” says Warren.

Technology not only makes occupational health products slicker and easier to use, but also has the potential to cut the costs associated with occupational health schemes.

A web-based absence management programme, for example, allows employees to log their own absence data online, rather than employers having to rely on a third-party to do so, or having to employ staff to carry out the task.

“The cost savings that are available through technology can be passed on to the employer, and give them the best return on investment possible,” explains Warren.

Focus on facts

What is occupational health?
Occupational health refers to the branch of medicine that looks at the effects of work on health and vice versa. It also covers the promotion of physical and mental health of employees in the workplace. Providers of occupational health can be organisations that employ occupational health practitioners on a regional or national basis, or individual doctors or nurses who provide services for staff in-house.

What are the origins of occupational health?
The issue of employees’ health in the workplace first became a concern in 1775 when Dr Percival Potts identified an occupational disease among tar-exposed chimney sweeps. The discipline of occupational health has since developed with support services now being provided by large healthcare companies and in-house occupational health departments.

Where can employers get more information and advice on occupational health?
The Commercial Occupational Health Providers Association (Cohpa) lists occupational health providers and offers employers industry news. Visit www.cohpa.co.uk or call 0333 772 0401.

The Health and Safety Executive (HSE) also holds information on occupational health at www.hse.gov.uk/pubns/taxrules.pdf

Nuts and bolts

What are the costs involved?
Occupational health schemes cover a variety of services from pre-employment health assessments to health screening, so the cost will vary widely. The number of employees and the type of risks they face at work will also affect the cost. For example, an employer could pay between £175 and £550 per employee for a health screening.

What are the legal implications around occupational health?
Employers have an implied duty to take reasonable care of the physical and mental condition of staff through the Health and Safety at Work Act 1974. If an employee suffers an injury as a result of work and it is clear that the employer breached their duty-of-care obligations, the employee could successfully sue the employer. Under the Management of Health and Safety at Work Regulations 1999, employers are obliged to assess the risk of stress-related ill-health arising from work activities.

What are the tax issues?
Occupational health is exempt from income tax and national insurance contributions where an employee receives treatment for an illness or injury sustained at work. Occupational health is a taxable benefit if staff suffer an injury outside of work and their employer helps to fund their return.

In practice

What is the annual spend on occupational health provision?
According to Mintel’s Occupational Health (Industrial Report) UK, published in June 2007, the annual spend on occupational health was £367m in 2006, which is an increase of 9% from 2005.

Which occupational health providers currently have the biggest market share?
Capita Health Solutions is thought to be the largest provider following its acquisition of BMI Health Services in 2005. Other large players in the occupational health market include Norwich Union Healthcare, Bupa, Grosvenor Health, Axa PPP Healthcare and Atos Origin.

Which occupational health provider has increased its market share the most over the past year?
Data on market share for each provider is unavailable. However, many operating in the industry believe that Capita Health Solutions, as market leader, will have increased its market share the most over the past 12 months.

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