On-Site Health Centers: Determining the Benefit to a Company’s ROI

On-site health centers are gaining popularity, offering accessible healthcare to employees. But their ROI varies. Letitia Heshmat's article explores the considerations for companies thinking about these clinics. While 43% of employers reported a 1.5:1 or higher ROI, measuring wellness program ROI isn't standardized. Key factors include company size, location, cost savings, employee needs, engagement, and space. Aligning the clinic with broader company goals is crucial, focusing on reducing claims, lowering absenteeism, and increasing productivity. Every business is unique, and a thorough analysis is essential to determine if an on-site health center is the right fit.

In her article, “On-Site Health Centers: Determining the Benefit to a Company’s ROI,” Letitia Heshmat delves into the increasingly popular topic of on-site health centers as a viable healthcare option for employees. She argues that while these centers can provide cost-effective, accessible healthcare services, companies must conduct thorough analyses to determine if an on-site health clinic would be a beneficial investment.

ROI Statistics

According to a 2021 survey by the National Association of Worksite Health Centers, most employers who measured ROI found that on-site clinics provide positive returns. Specifically, 43% reported an ROI of 1.5:1 or higher, and 31% reported an ROI of 2:1 or higher. However, Heshmat cautions that no universally accepted method for measuring ROI for wellness programs exists. Only 23% of companies report tracking their ROI, making it difficult to ascertain hard-dollar savings.

Factors to Consider

Heshmat outlines several key factors companies should consider before implementing an on-site health center:

  1. Population Size & Location: A smaller company may not achieve the same ROI as a larger one due to the fixed costs of establishing a clinic. The clinic’s location is also essential; centers in rural or underserved areas can be invaluable, potentially resulting in higher ROI.
  2. Cost Savings: While the upfront costs can be high, companies should weigh these against the long-term benefits. Clinics can offer preventive care and early intervention, reducing more expensive healthcare costs in the future.
  3. Employee Health & Wellness Needs: Companies should consider the specific health needs of their employees. For example, those with higher rates of chronic diseases may find an on-site health center highly beneficial.
  4. Employee Engagement & Satisfaction: On-site health centers often improve employee loyalty and job satisfaction. They demonstrate a company’s commitment to employee well-being, leading to greater productivity and reduced turnover.
  5. Space & Design: Physical space limitations and the clinic’s ambiance must be considered. The design and atmosphere should make employees feel valued and cared for.

Considering the Objective

Heshmat points out that one of the most important aspects of implementing an on-site health clinic is to align it with the company’s broader goals. While the objectives may differ from business to business, a general standard should involve setting strategic, measurable goals for improving employee safety and health. These may include reducing workers’ compensation claims, lowering absenteeism, and increasing productivity.

Her comprehensive overview leaves companies with a much clearer understanding of what it takes to implement a successful on-site health clinic, arguing that it is not a one-size-fits-all solution. The decision should be based on a careful evaluation of numerous factors, from company size and location to the specific health needs of its employees. Therefore, businesses must conduct an in-depth analysis to assess whether an on-site health center would be an effective strategy.

Interested in Learning More?

If you would like more information on how an on-site health center could benefit your company or having Letitia Heshmat as a speaker, contact Work Health Solutions.

Work Health Solutions

Work Health Solutions

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A series of notable accomplishments distinguish Dr. Michael Tenison’s career in medical operations and healthcare management:

  • Successfully led medical operations at a national healthcare provider, focusing on optimizing healthcare delivery and patient outcomes.
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Dr. Matt Feeley is a renowned figure in military aviation medicine, with a robust background in occupational and environmental medicine from the Johns Hopkins Bloomberg School of Public Health. 

  • Former Naval Flight Surgeon, exemplifying his expertise in aerospace medicine and commitment to military health.
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A physician-attorney with a dedication to healthcare innovation, informatics, and digital health.

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  • Trained in residency at Harvard, achieving board certification as a physician; also a licensed patent attorney with experience as FDA regulatory counsel.
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Erin Davis

 Chief Clinical Officer at Work Health Solutions, certified in Adult-Gerontology (AGNP-C) and Athletic Training (ATC).

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  • Former Manager of Clinic Operations and Occupational Health Nurse Practitioner at Stanford University Occupational Health Center (SUOHC).
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Expert in benefits design and onsite innovation with specialization in the pharmaceutical industry.

  • Previous role as Executive Director for Employee Health at Novartis Services, Inc., leading health services and clinical support.
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