IMWell Innovating On-Site Health Care

The company infirmary is making a comeback.

Decades ago, it wasn’t unusual for large factories to have a company nurse or doctor who could see to the medical needs of employees while at work.

With health care and insurance costs increasing by as much as double-digit annual rates, large employers are rediscovering the advantages of providing on-site medical care to their workers.

Studies by the National Business Group on Health and Watson Wyatt Worldwide estimate 23 percent of large companies (1,000 employees or more) provided some on-site care in 2007. That figure was expected to grow to 29 percent in 2008 and to 32 percent by 2009.

IMWell Health LLC, with most of its business in the Fort Smith area but with a reach stretching from Oklahoma to Hot Springs, is part of that growth curve.

IMWell Health debuted in 2005 with an initial focus on wellness counseling that quickly expanded into general medicine. From 2006 to 2007, IMWell doubled its employees, patients served and revenue.

The company, owned by Dr. Catherine Womack and Dan Parker, now has five dedicated, on-site clinics at employers such as OK Industries, Weldon Williams & Lick and Riverside Furniture in Fort Smith. IMWell has grown to 30 employees, including two full-time doctors, a part-time doctor, four nurse practitioners, a physician’s assistant, six LPNs and one RN.

It also has free-standing clinics in both Fort Smith and Hot Springs that exclusively serve the employees, spouses and dependents of smaller companies in the area for whom an on-site clinic is impractical. By pooling resources with other small businesses, companies now have access to lower cost care without sacrificing quality and productivity.

IMWell’s first clients were brought to Womack by Caryol Hendricks and the Employer Health Coalition, a Fort Smith-based organization of self-funding companies. Self-funded companies pay all of their employees’ medical bills rather than use an insurer such as Arkansas Blue Cross/Blue Shield.

The EHC was banded together to do price-based negotiations with Fort Smith-area hospitals and Hendricks approached Womack when she heard the general practitioner was interested in starting a company that performed wellness and chronic disease management.

Joint Effort

After seeing and counseling several employees on wellness, disease management and preventative care, Womack began hearing a familiar refrain as she sent patients off to see other doctors.

“After a while, it was always, ‘Why can’t you just treat me?'” Womack said. “That’s when I went to the employers. It really evolved from watching these poor people not have access to health care.”

From there, Womack said, it was a matter of process: putting clinics in place, finding out from employers what their medical needs were and finding access to providers and affordable medicines.

“It has really mushroomed over the years,” said OK Industries director of benefits Mike Evans. “Back when we [the EHC] first started looking, on-site care wasn’t nearly as popular or well known. It was not an idea on most companies’ radar screens at the time.”

National companies that provided on-site care required a minimum of 2,000 employees to be cost effective. While Fort Smith is a manufacturing hub within Arkansas, most of its factories don’t meet that threshold.

“It worked out that Dr. Womack started working with members of the Coalition and it became a joint effort,” Evans said.

Parker, the company CEO and a 50-50 partner with Womack, said IMWell now serves approximately 12,000 employees and 30,000 overall counting spouses and dependents who are also eligible to use the clinics. IMWell also has an on-site clinic at the University of Arkansas-Fort Smith that serves an additional 6,000 students.

The company is now eyeing both Northwest Arkansas and central Arkansas for future growth. Womack lives in Fayetteville, Parker in Little Rock. Parker said the key to expanding into either market will be securing an “anchor client”: a company large enough to make it cost effective to move into a new area.

IMWell has been focused from its start on cash flow, Parker said, and its only initial start-up expense was payroll.

“I was able to get our initial customers to pay for the equipment, reimburse us for out-of-pocket expenses, furnishings, supplies,” he said. “All we had to do was hire people.”

About a year after starting its first on-site clinic, Parker said IMWell used Regions Bank for a line of credit to handle fluctuating payroll and to eventually purchase and build out its free-standing Fort Smith clinic.

Parker said a $475,000 loan from Regions covered the startup costs of the Fort Smith facility that covered all equipment, furnishings and the building purchase price.

Cutting Costs

Various industry studies of on-site care report that the return on investment can be dramatic. The low end of ROI is $3 for every $1 spent and some put the number as high as $5 to $6 in benefit for every $1 spent.

Some on-site clinics can be set up for less than $10,000, Womack said.

From there, the pricing for services is negotiable.

“Some have flat rate,” she said. “Some pay per month, some hourly, some get a discount off service. That’s where my business partner [Parker] comes in.

“I go in and tell him how many people they need staffing the clinic. Depending on their budget and what they want to provide, we say, ‘This is what we think you should start off with.’ You want the ability to expand and add people on. You also want to make it cost efficient.”

Some savings are still being measured, such as comparing productivity, workman’s compensation claims, absenteeism and a new term “presentism,” which refers to workers who are present but unproductive because of illness.

Riverside Furniture saw its health care costs decline by 17 percent from 2005 to 2006 after installing an IMWell clinic. Its costs declined another 5 percent from 2006 to 2007.

In Hot Springs at ChemFab, costs per employee declined by 22 percent from 2006 to 2007.

The anecdotal evidence is even more powerful.

One older gentleman Womack saw at Riverside had a blood pressure reading of 240 over 130. It was so bad, Womack said, that she could see burst blood vessels in his eyes.

The man was on the verge of a stroke and when Womack suggested as much, he told her he couldn’t go to the emergency room anymore because he owed them too much money.

Womack asked him if he could afford a $4 generic drug from Wal-Mart. By the next week, his blood pressure had declined dramatically and through wellness counseling he eventually lost 40 pounds and stopped drinking.

A previous stroke for a Riverside employee cost the company $100,000, Womack said.

Another example was a diabetic who couldn’t afford the testing supplies and only took insulin when he “felt bad.” Tests showed he had high blood sugar and his kidneys were beginning to malfunction.

Within three years he would have likely been on dialysis at a cost of $60,000 per year. If he’d been fortunate enough to qualify for a kidney transplant, the cost would have been between $100,000 and $150,000.

“What tends to drive costs are the more significant cases,” Parker said. “You can’t do anything to change the trauma of a car wreck. Our biggest influence is in managing chronic disease. We provide easy access to good care and keep you out of the emergency room or from a stroke or other significant event.

“That is going to have a positive impact on what [employers] are spending.”

Womack calls Wal-Mart’s $4 generic program launched in 2006 a “God send,” and noted that some generics that cost more than $50 when she first set up at OK Foods are now on the $4 list.

For managing chronic diseases like high blood pressure and diabetes, Womack says she can often find the drug she needs on Wal-Mart’s ever-updating list.

“I’ve already checked the list four times today,” she said. “Seventy-five percent of the medicines that are filled are generics.”

Womack, unlike many providers, doesn’t automatically refer patients for expensive ancillary services like MRIs or CAT scans.

“The classic case is a headache and the person wants a CAT scan,” she said. “And I’ll say, ‘These are tension headaches. Let’s try treatment for a week and if you’re not better or you’re worse, I’ll order it.’ Usually they come back the next week feeling fine.”

Womack also uses Wal-Mart’s pharmacy services to track employee purchases. If someone isn’t getting his or her prescription filled, the employer can be notified.

“You can chase down noncompliant patients,” she said.

The real cost savings, Evans said, are difficult to measure.

“To keep costs comparable was the goal,” he said. “We’ve achieved that and actually done somewhat better. But we also recognized the initial dollar cost was not the actual savings we’d garner from program.

“The real savings is in the goodwill of employees — the care they’re getting and knowing they’re getting good care. The goal is to take care of the whole person, not just what’s wrong with you today.”