A growing service

Any OH practitioners hoping for a quiet life over the next few years will be disappointed by the latest snapshot of the OH market.

For the rest of us, however, the study by research body Market & Business Development (MBD) shows a market that is growing rapidly and evolving as it does so, but which is likely to be constrained in the future by workforce issues, and something that in turn could create difficulties when it comes to workload, stress, training and the health of OH practitioners themselves.

MBD has estimated that the total market for OH provision last year totalled 318m, and is set to grow massively over the next four years.
The market, it has predicted, will grow by 19% in real terms between 2005 and 2009, and by 4% to 5% year-on-year.

The profile of OH within the workplace is rising, and companies are increasingly recognising that if they want to effectively manage workplace health in all its facets – and not just absence – they need the skills that only OH professionals can bring.

The public sector is predicted to remain the largest single user of OH – offering providers “a strong opportunity to establish track records or performance that can be transferred into the private sector”.

With absence levels still generally higher in the public sector than the private sector, absence management will remain a key concern for public sector employers, and expenditure is likely to increase, particularly at local authority level, it says.

According to MBD, the market is being driven by three main areas: health and safety, personnel management (including employee assistance programmes), and wellness.

Ironically, the constant demand within businesses to reduce spending has led to greater emotional, psychological and physical pressure being put on workers, which in turn has led to increased demand for, and extra spending on, OH.

But there is also an ongoing tension between an employer’s hard-nosed desire to see objective, tangible benefits from their spending on OH, and what OH professionals argue are equally important, but less tangible, benefits of improved morale, conditions and well-being.

“It is claimed by some that productivity gains are evident from OH schemes, although the empirical evidence is, at best, unclear. In addition, it is almost impossible to apportion the degree of benefit to single factors such as OH provision rather than, say, technological improvements,” according to the MBD research.

The demands of an ageing working population are likely to be another factor within this process, pushing OH yet further up the workplace agenda.

A key area for this growth is, and will continue to be, the outsourced OH market, which MBD forecasts will grow by 35% in real terms in the four years to 2009.

In fact, if anything, argues Mike Goldsmith, deputy chairman of the Commercial Occupational Health Providers’ Association, MBD’s predictions are conservative.

“Some of our members are reporting growth of around 20% a year. Some have had a sevenfold increase in turnover in the past seven years,” he says.

Within large organisations, it is not having some form of OH facility or access to OH that has now become unusual, rather than the other way around.

“Occupational health is becoming a sine qua non, particularly when it comes to medico-legal issues,” he says. “It is becoming unacceptable for companies of any size not to have occupational health.”

The biggest constraint on growth, however, will be workforce planning issues. “One of the most significant limiting factors is likely to be the lack of trained OH specialists,” MBD argues.

It is this, then, that should be ringing the alarm bells most for OH professionals. Yes, it is good the profession is taking centre stage much more, and yes it is good for business and employees to be in demand. But, as it stands, OH is still a relatively small profession, and there are already signs that, as the scope of OH widens, its remit increases and the demand for quick solutions intensifies, that OH professionals are going to come under increasing pressure.

Inevitably, if the market continues to grow as MBD has predicted, there will be strain on the system, increasing the workload and profile of practitioners and putting them under ever greater stresses and demands.

The effects are already being felt. A survey by recruiter OH Recruitment back in February last year found OH practitioners to be increasingly stressed, with some turning to alcohol or drugs to cope with rising pressures.

More than half of the 129 OH professionals questioned admitted to feeling stressed at work, with two-thirds claiming their work environment had become more stressful over the past 12 months.

There may, too, come a time when the profession reaches a “pinch point”, where demand outstrips supply, predicts Goldsmith.

This is a situation that will only be exacerbated by the government’s desire to get many people off incapacity benefit and into work, and demands by GPs to hand over some responsibilities, particularly surrounding workplace issues and writing sicknotes, to OH practitioners.

On the other hand, as a medical profession, OH is still very attractive to many people in that it offers relative autonomy, pretty standard hours, good rates of pay (with commercial base salaries somewhere around the 28,000 to 33,000 range), relatively varied work and access to the commercial sector.

Publisher Lexis-Nexis recently estimated the average full-time salary for an OH professional had now reached 32,000. Recruiters report continuing demand, with some very top salaries, particularly those for OH physicians, now breaking through the 100,000 barrier.

The number of OH nurse consultants is increasing, albeit slowly, as the profession grows in importance within the NHS.

Similarly, if the market expands as predicted over the next four years, there are likely to be issues about the quality, consistency, provision and availability of training.

While it is right and proper that the profession enforces rigorous standards and protects the specialist practitioner title of OH nurse, the difficulty is that, for many employers, this is much less of an issue.

“We need to make sure that OH professionals do not price themselves out of the market, either through cost alone or through professional practice codes,” warns Dr Mark Simpson, managing director AXA/PPP OH services.

“Most clients could not give two hoots about qualifications,” he concedes. It is therefore going to be a challenge to educate employers about the role of the OH nurse, what the alternatives are and what each alternative can offer.

The other unspoken challenge in all this remains the issue of small and medium sized-enterprises (SMEs).

As the government itself recognised last year with the launch of its Workplace Health Direct pilot for SMEs, this is an area that remains something of a black hole for OH professionals.

NHS Plus has been making inroads, but there is still a long way to go, with employees within small businesses who have access to OH still a very low percentage.

The problem for many SMEs is not an unwillingness to call in OH or offer workplace health provision to their staff, but the fact that many of them simply have no spare cash or energy for something such as OH, suggests AXA’s Simpson.

“Most SMEs operate in survival mode. They are just trying to survive to next week,” he says.

But there may be a flicker of hope for the issue of low take-up, as the MBD survey identifies a potential trickle-down effect as the market expands.

It concludes: “As companies incorporate occupational healthcare provision into their benefits packages, the competition for good employees will ensure that the uptake of services by organisations will be rapid and that the occupational health provision market will gain a high degree of momentum, ultimately trickling down to medium and smaller companies, although by definition these tend to be among the most sensitive customers to price and may therefore not be as attractive to the larger providers.”

The gap between the haves and have-nots when it comes to OH is an increasing concern, suggests Cohpa’s Goldsmith.

“My worry is that we will end up with a two-tier system: those that can and those that cannot afford a doctor-based service,” he warns.

It is also often the case that the people who are least able, or willing, to pay for OH are the ones that need it the most.

There has also, over the past few years, been an increasing ‘professionalisation’ of the OH profession, suggests Goldsmith.

While you will, of course, still find GPs who have an interest in OH and work extensively with employers, it is more and more the case that employers, whether public or private, want professional, specialist OH practitioners.

“The days of the factory doctor have pretty much gone. Increasingly, it is real expertise that is required,” he says.

But AXA’s Simpson’s also warns that the MBD figures need to be treated with a degree of scepticism, particularly the 318m figure, as valuing the OH market is notoriously difficult.

“By my estimates, the largest four or five providers turn over around 50m between them, with the NHS and armed services, and operators such as Tesco and John Lewis, around 2m each,” he calculates.

Having said that, the trends the survey identifies are real enough, particularly the continuing move towards outsourcing. “Even companies that you would have thought might have been uncomfortable with the idea are now outsourcing,” he says.

Perhaps just as interesting is the fact that MBD and OH commentators agree that as time goes on, OH will need to change the way it is perceived by individuals and employers alike.

Just last month [July], Dr Bill Gunnyeon, outgoing president of the Faculty of Occupational Medicine, called on the profession to broaden its horizons to address not only the health of working people, but the working age population as a whole.

AXA’s Simpson echoes the point, arguing that one thing OH professionals need to be careful about is becoming too closely linked in the minds of employers to absence management alone.

While this is a key part of the OH function, practitioners need to make it clear to employers that there is much more to OH than simply policing absence.

A lot of the time, OH is still seen by employers as something reactive – a tool to head off expensive litigation costs, to meet health and safety requirements or because it is good for morale, the MBD report points out.

But what’s needed, it stresses, is to push home the message that OH is not simply a nice add-on but something that can bring real commercial benefits.

“Many companies within the OH sector continue to promote the health benefits rather than the commercial benefits, with the latter remaining the dominant driver of demand. This is exacerbated in more adverse economic conditions,” it says.

“The industry has the potential to enhance this image by establishing a more consistent package of what is defined as OH, although such consolidation is likely to be hindered by the growth of the market, which provides little incentive for this,” it adds.

A full copy of the report is available from MBD (550 for a single report or 660 for an annual subscription consisting of four reports), go to www.mbdltd.co.uk or telephone 0161 247 8600 for more information

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