Document x1zKd3rzjkjeezLjGXKJ5DzxQ

* w*. '';X- 2RA3T ^ HEJ :CB T/2^/T2 PROPOSAL FOR PERIODIC HEALTH EXAMINATION PROGRAM. PLAINTIFF'S (U EXHIBIT I 1W4^-00 1. THE PAST Shell's present Periodic Etfaslnation Program appears to be characterized by: 1. Numerous periodic appraisals over a number of years by various groups which have almost universally recommended that the program be improved or .Junked. 2. An apparent lack of definite response by Management to the recommendations of the appraisal groups. 3. Poor employee acceptance and participation in the program. h. Concepts and procedures which prohibit Management from realizing an optimal return on its investment. II. VhE PRSS5K1 ?ne advent of OSIIA makes it clear that the Company must develop an examination program of seme type, regardless of Its philosophical viewpoint, lx is anticipated that by the end of the 1972,/National Institute of Occupational Safety and Health will have issued criteria documents on asbestos, noise, heat, ultra violet radiation, tetraethyl and xetramethyl lead, silica, mercury and arsenic. In 1973, additional documents are scheduled covering toluene and benzene, cotton dust, sulfur dioxide and sulfuric acid, TDI and trichloroethylene. Other documents in preparation, but without specifically assigned completion dates, ABS-0l66i7 WV-12946 PROPOSAL FOR PERIODIC HEALTH EXAMINATION PROGRAM 2. include fiberglass, parathioxv, ca/Ai&iua and chrozaic acid. It ia impossible to predict with accuracy the extent of medical examina tion requirements that will be contained in these documents or in the QSKA Standards which they generate. If the documents already issued, however, (asbestos, noise, beryllium, heat stress) are any indication, large-scale examination programs aay be required. The facts leave us no real alternative. We will be involved in an examination program whether we wish to be or not. The only question remaining to be resolved is the scope of that program, The required examination programs will necessitate expenditures for physicians' services far beyond past investment. The second question to be resolved, then, is whether this invest ment will bo made in outside reedical facilities, or whether ve develop it within the Company. From a purely economic standpoint, the answer to this question will depend upon the number of examinations required by law. There are a number of benefits to be derived from a Periodic Health Examination Program applicable to all employees. Among these are: reduction of absenteeism, improvement in general employee health and performance, improvement In Workmen's Compensation experience, and betterment of employee morale. A ASS-016618 PROPOSAL FOR PERIODIC tEALTH EXAMT.KATIOK PROGRAM fifth factor, however, looms evefl more important in the light of increased Federal regulation of the work environment - This factor is the generation of statistical health data on employee populations exposed to real and theoretical hazards. As valu able as animal studies are in the current procedure of setting threshold limit values, they are not nearly as importact as the effective demonstration that human populations exposed to given levels of materials fail to demonstrate detrimental changes. Such studies require large employee populations, both in exposed and control groups to have real significance. For these reasons alone, it would appear wise to seriously consider th$ institution of a Periodic Health examination Program applicable to all employees. The program which I recommend would be of the Multi pass ic Health Screening type, and would utilize computerization of test results, sc that data would be easily retrievable for retrospective correlation studies. Frequency of the examination would depend upon age group, general health status, and potential of exposure. -xi ?h FUTURE. HOUSTON AREA Within the next two years, the Shell employee population based in the Houston area will approach 10,000, This high degree of centralization, coupled with the availability of excellent medical services, creates a nighly suitable experimental group for the development of an examination program. A number of alternatives may be considered. ABS'016619 PROPOSAL FOR PERIODIC HEALTH EXAMINATION PROGRAM 1. A. Alternative 1 Art examination program applicable to all employees in the Houston area would require approximately 3600 examina tions per year. Frequency of examination would be based upon age and potential risk considerations. Approximately 1200 of these examinations would be performed annually at a consolidated Houston Refinery-Chemical Plant medical installation. The remaining 2LQ0 examinations would be performed on employees of Head Office, Bellaire Laboratories, Research Center and Information Center at one or more locations to be determined. If obtained through community medical, channels, the approximate cost of these examinations would be $270,000 annually. Clearly, then, we should consider performing the examinations ourselves in Company facilities. An in-house program of this nature would require the acquisition of additional physicians, nurses and equipment. Additional personnel requirements for an in-house program, along, with estimated costs per year are given in Appendix I. S>. Alternative 2 Ah obvious alternative to the above plan wou^d be to include in the examination program only those employeec having some determinable risk of occupational exposure. Such a program would be limited to production workers at the Houston Refinery-Chemical Complex, and to selected laboratory personnel, 'X'r.e advantages of this alternative ABS-016620 PROPOSAL FOR PERIODIC HEALTH EXECRATION PROGRAM are obvious from an economic standpoint, but are nullified in part by the loss of statistical data that would otherwise be generated on non-exposed personnel. Estimated costs for this alternative are also given in Appendix 1. C. Alternative 3 A third alternative is to limit the examination program to those employees whose examination is required by Federal or State regulation. The disadvantage cited in Alternative 2 above is equally applicable here. Additionally, the Company would surrender without question all the previously cited ancillary benefits of a comprehensive medical examination program. Since Federal and State require ments are not yet clearly defined, realistic cost estimates for this skeleton program cannot be developed. IV* THE FUTURE: OTHER SHELL LOCATION'S The initiation of a Feriodic Health Examination Program at other Shell locations should bo deferred pending the collection and evaluation of data gathered during the first year of operation of the Houston program. Ar. exception to this recommendation is, of course, inherent in examinations required by Federal and State regulation. ABS-016621 PROPOSAL FOR PERIODIC KJfALTK 2XAKXKATX0K PROGRAM 6. V. COST OFFSETS The costs detailed above do not represent net expense to Shell, since several offsetting factors coroe into play. The first and most important of these factors is the intangible benefits associated with the acquisition of a full-time on-site physician at the Houston Refinery-Chemleal Complex, Only about one-half of the physician's time would he devoted to the Periodic Health Examination Program. The remainder of his time would be utilized in the treatment of occupational injury, health education and counseling, absence control, alcoholism and drug addiction, training, research and administration. Assigning a value to these activities at this stage of discussion is unrealistic, and no attempt will be made to do sc. Other factors, however, can be calculated into economic terms with reasonable accuracy. Examples which are readily identifiable are: A. The on-aite physician should be capable of performing all preemployment, periodic t*_na special hazard examinations at the Medical Department. These examinations have previously ASS-016622 PROPOSAL FOR PERIODIC HEALTH EXAMIKATXOJi PROGRAM T- been obtained through community medical sources and, based upon the recently completed Survey of Medical Services, if performed on-site would affect a saving of approximately $24,000. B. Rased on the assumption that two-thirds of outside medical treatment fees would also be eliminated by the use of an on-site physician, an additional savings of $14,000 would accrue. C. If the recommended examination program is initiated, an additional $7,000 per year would be saved through the elimination of a large portion of outside x-ray services. This savings represents only that part of x-ray service used in the Periodic Examination Program. In actual practice, the availability of on-site x-ray service in trauma cases should considerably increase this savings. The estimates shown above indicate that an on-site nhysician would offset almost one-third of the cost of Alternative 1, and twothirds of the cost of Alternative 2. Details of calculations upon which these conclusions are drawn are available upon request. the costs of When considered jn terms of percent of payroll,/the proposed program are very small indeed. The potential return could be very great. ABS-016623 APPE10IX I COST ESTIMATES, HOUSTON AREA EXAMINATION PROGRAM Alternative 1 below assumes consolidation of medical services at the Houston Refinery-Chemical Complex, and availability of the examination program to all employees regardless of ^ob classification. Alternative 2 below assumes similar consolidation of medical services at the Houston Refinery-Chemical Complex, but limitation of examination to groups of employees with determinable risk of occupational exposure. Calculation of costs for Alternative 3, previously mentioned, is not feasible at this time. TABLE X 't 1. One full-Lime physician at Houston Refinery-Chemical Complex 2. One full-time physician to serve Head Office, Bellairc Labs, Research Center and Information Center 3. One additional nurse to be stationed at Research Center * 4. One additional nurse to be stationed at Information Center 2st. Annual Cost Ret. Annual. Cost Alternative 1 _______Alternative 2 3 30,000 $ 30,000 30,000 10,000 10,000 10,000 ----- * This additional staffing will be required even if an examination program is not institutedv therefore, it does not truly reflect costs attributable to examination program. AB3-016624 APPENDIX I TA2LE I (Cont'd) ITEM Est. Annual Cost Alternative 1 Est. Annual Cost Alternative 2 5. Annual supply budget for examination program 6. Additional equipment purchases necessary for institution of program (non-recurring costs) 7. Chest x-rays (if obtained through outside medical facilities $ $15- ea.} COST PER EXAM TOTAL $ 12,000 (3600 exams) 6,000 51,000 ........... ........ $152,000 $42.22 3 4,000 (1200 exams) 3,000 16,000 --. $ 65,000 $54.16 Alternatives applicable to Item 7, Table I are worthy of considerate on. The item T cosh figure assumes chest, x-rays to be obtained through outside medical channels. Provision of in-house x-ray facilities, however, could favorably affect tneue coats. An initial .investment of $15-50,000 per x-ray installation would be required. Annual operating costs, however, should not exceed <p3?,0Q0 for one location, or $42,000 for two locations. It is obvious, therefore, that the initial investment and annual operating costs would be offset by attendant savings within two to four years, depending upon the number of employees x-rayed annually. Consolidation of the houstor. Refinery-Chemical Complex maxes installation of or.-site x-ray facilities ever, more attractive. ABS-0.1 6625 /o/<- SHELL OIL COMPANY ABS- 03.6626