At-Work Health Centers a Popular Prescription

Bloomberg Law for HR Professionals is a complete, one-stop resource, continuously updated, providing HR professionals with fast answers to a wide range of domestic and international human resources...

By Martin Berman-Gorvine

On-site medical centers are increasingly popular with both workers and employers, and they can help cut health-care costs. But to avoid legal headaches, employers need to do some compliance planning.

The centers can offer urgent and acute care, buttressing what employees get from their primary care physicians, as well as mental health services and broadly defined wellness services.

The concept isn’t new but the focus is, Ann Hartman, vice president of customer experience management at Marathon Health, told Bloomberg BNA Sept. 11.

“In the old days,” big companies such as American Airlines and IBM had a “doc on-site” for urgent medical care, but that was about it, she said.

The centers are convenient for everyone, she says, noting that employees who can see an on-site provider don’t have to “take half the workday” to get to their personal physician, Hartman said. Winooski, Vt.-based Marathon Health provides “turnkey” versions of on-site centers to other companies.

The National Business Group on Health says that more than half of large employers it surveyed will be offering on-site or near-site health centers in 2018. That percentage could increase to almost two-thirds by 2020, the group said, citing its Large Employers’ 2018 Health Care Strategy and Plan Design Survey. The NBGH said the centers often result in less absenteeism and presenteeism, meaning coming to work while sick.

Cutting Costs, Gaining Time

On-site health-care centers have “increased in recent years,” Andrew Cavanagh, managing director of Philadelphia-based Pareto Captive Services, told Bloomberg BNA Sept. 11.

They’re one of the best ways for employers to reduce the cost of health care, he said.

And the centers give employees access to health care and free up their time. Pareto helps companies develop on-site health-care centers that are “shared” with other companies and also helps midsize companies with self-insurance programs.

Caution, Lawyers Ahead

However, if an on-site center or clinic “is doing anything more than standard first aid, all sorts of laws kick in,” Laura Jacobsen, an associate at McDonald Carano in Reno, Nev., told Bloomberg BNA Sept. 8. Her law firm does mostly management-side work.

The patient confidentiality requirements of the Health Insurance Portability and Accountability Act apply, she said, and the Employee Retirement Income Security Act comes into play, as well as the Consolidated Omnibus Budget Reconciliation Act mandates when employees lose their jobs.

In a unionized workplace, management would have to negotiate the kinds of care provided with the union, Jacobsen added.

Moreover, there are varying state laws covering a host of areas such as medical waste disposal, licensing requirements, and “corporate practice of medicine,” she said.

In Nevada, for example, a for-profit corporation can’t employ a physician. So a physician working at an on-site health-care center would have to be an independent contractor, she said. The state also bars doctors from referring patients to any entity in which they have a financial stake. Laws also vary depending on the medical specialty involved, she said.

Keeping Health Information Private

Employers also need to have a firewall policy that bars managers from accessing information that on-site health professionals collect on employees, Jacobsen said. If a health-care center knows about the disability of an employee who’s later fired, for example, the former worker could make a discrimination claim under the Americans with Disabilities Act or the Family and Medical Leave Act, Jacobsen said.

Similarly, the employer should avoid the appearance of medical decisions being made for business reasons, such as pressure on medical professionals to certify an employee as fit to return to work. There should be “a designated line of communication between the medical provider and the right layer of management” to avoid that, Jacobsen said.

In short, “from a business perspective, it might save money, but from a legal perspective, it’s complicated,” she said.

Centers Popping Up in Underserved Areas

Contractor BAE Systems operates the U.S. Army’s Holston Army Ammunition Plant in Kingsport, Tenn., where an on-site health-care center has been operating for almost eight years. The health centers are proliferating especially in communities where it’s difficult to get health care, Kevin Robinson, manager of wellness at the Kingsport site, told Bloomberg BNA Sept. 11.

The Holston center began as a wellness center, but after partnering with Marathon in 2010, BAE expanded it to offer a much broader range of health-care services.

Robinson said many employees have told him the acute-care services the center offers are the second-most important benefit they receive after compensation.“A lot of new employees don’t know they have conditions like high blood pressure or high cholesterol,” and the center can help them in their first few months on board, he said.

If he were to start over from scratch, he said, he would have the center offer wellness and acute care services from the beginning. The growth of these centers is likely to continue, he said.

To contact the reporter on this story: Martin Berman-Gorvine in Washington at

To contact the editors responsible for this story: Peggy Aulino at; Terence Hyland at; Chris Opfer at

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Bloomberg Law for HR Professionals