NEW ORLEANS—In response to the dearth of medical services available in New Orleans following Hurricane Katrina, Harrah's Entertainment Inc. is opening a clinic for its employees and their dependents at its newly reopened casino there.

The Las Vegas-based casino giant also hopes that providing basic health care services on site will make it more attractive to potential employees at a time when labor is in short supply due to the displacement of many workers when their housing was destroyed by the August 2005 storm.

Although Harrah's has three other worksite clinics and had intended to establish the New Orleans facility eventually, it moved up the opening date when it became evident that the medical infrastructure in the Big Easy was not rebounding as quickly as was needed.

In the wake of Katrina, the city of New Orleans was left with only 456 staffed hospital beds, compared with 2,269 before the devastating storm forced levees to break and flood the city, according to the U.S. Government Accountability Office in Washington.

Among the casualties was Charity Hospital, the city's only Level 1 trauma center, which was closed after its basement flooded, ruining its electrical system. New Orleans officials have said the hospital cannot be saved because of exposed asbestos and bacteria that flourished in the late summer heat.

Provider networks also were significantly disrupted when physicians were forced to flee the city along with other inhabitants, according to HealthLeaders-InterStudy, a Nashville, Tenn.-based company that provides managed care industry data and analysis.

After the storm, "we had as a concern the availability of quality health care in New Orleans," explained Anthony Sanfilippo, Memphis, Tenn.-based president of the central division for Harrah's, whose responsibilities encompass all of the properties that were affected by Katrina.

"Many physicians have relocated to other areas, and New Orleans is going to have to reassess and rebuild its health care system," he said.

So when the company began planning its casino reopening, "we started to look at issues such as not only the repair of the building but also the availability of services for our team members. And we quickly said, because of our experience with health clinics in other locations, that we thought it would be a terrific benefit to have a health clinic that was available to all of our employees in New Orleans," Mr. Sanfilippo said.

The clinic will provide a variety of basic health care and other services (see related story).

Harrah's currently operates three other health clinics, located in Tunica, Miss.; Atlantic City, N.J.; and Lake Tahoe, Nev.

The Tunica clinic was the first to open in March 2005, because that casino is located in a rural area with little access to quality medical services, explained Dave Beech, a consultant in the Los Angeles office of Watson Wyatt Worldwide Inc. who works on the Harrah's account.

Because it is located in an urban area, Harrah's New Orleans clinic probably would have been "a couple of years away," according to Mr. Beech. But "because health care is really spotty down there right now, they decided to move up the timeline on New Orleans," he said.

"When we were doing our strategic plan, New Orleans was on our map. When the hurricanes hit, we had to pull back. But Anthony (Sanfilippo) said, 'We needed to open the clinic.' He realized how dire the situation was," recalled Juliet Vestal, director of health care management for Harrah's in Las Vegas.

Health benefits experts who have seen Katrina's devastation first-hand were supportive of Harrah's decision to provide basic health care services to its employees and their families onsite.

"This is a very good move," said Kip Wall, former chief executive officer of the Office of Group Benefits for the state of Louisiana who is now a lawyer in private practice in Baton Rouge, La.

"The medical services infrastructure in New Orleans has been severely damaged, he said. In addition, "there is a labor shortage, and to hire and retain qualified people you have to provide them with some type of assurance that basic services are going to be available," said Mr. Wall, who is with the firm of Simon, Fitzgerald, Cooke, Reed & Welch.

Indeed, "the issue is being able to collect a workforce and supplies, because this covered such a broad area--literally well over 100 miles--it's a lot of ground that has to get rebuilt," said Mr. Sanfilippo.

But when Harrah's New Orleans Casino reopened on Feb. 17, it had a staff of 1,600, 90% of whom were prior employees, he said. Mr. Sanfilippo attributed much of the retention to the services--which also included housing assistance--the company has provided to its workers since the storm.

This feat "surprised many people in New Orleans, because many businesses were struggling to staff 25 or 50 people," he said.

Within a week after Katrina, Harrah's also worked with its vendor, Cleveland-based Whole Health Management Inc., to set up temporary health clinics in Biloxi, Miss., and Baton Rouge, La., to help its employees and their families, according to Mr. Sanfilippo. They operated for about 45 days following the storm.