My past few months’ readings have been eye-opening in the areas of health and wellness, productivity, worker’s compensation and healthcare in general. While I’ve always known that there were connections between these, they have traditionally been measured, reported and handled in vacuums without much integration. Intuitively, most people see the connections on the surface, but few realize the full impact that the interplay of multiple factors have on any given single factor.
In a recent article published by the American College of Occupational and Environmental Medicine, one professional commented that “lost productivity due to health-related reasons is a very real cost that is difficult to quantify…employers cannot address high health care costs by focusing on just direct spending. The poor health of employees is an equally important issue that must be addressed…”
The article goes on to offer that when looking at medical and drug costs without integrating all related factors, the costs associated were about $170,000 per 1,000 employees. However, when all of the associated costs were compiled, the costs grew to about $500,000 per 1,000 employees.
Looking at your own company, consider how you see these factors and whether or not you connect the dots. If a worker is injured on the job, modified duty may be provided, or they may be off work for a period of time, and productivity is lost. But have you ever stopped to ponder that if that same worker is off work because of a heart attack or an amputation related to a diabetic ulcer, the daily lost productivity is the same? However, your company most likely does not integrate those numbers in lost productivity. Different insurance lines mean different statistical data, right?
Consider the interplay of lost productivity across the workers’ compensation/non-workers’ comp lines. According to the CDC, work injuries cost $120 billion in medical care and lost productivity, while workplace alcohol, tobacco and other drug use costs US companies $100 billion each year. A 2005 study published in the Journal of Occupational and Environmental Medicine identified non-workers’ compensation for decreased worker productivity. For example, if a worker smokes, there is a 2.8 percent loss in productivity. If he or she is physically inactive, there is another one percent productivity loss.
The important point to remember is that without integration and considering the worker as a whole, there is only so much that the employer can accomplish in reducing workplace costs. While it is good to “drill down” and know where the company is spending money—i.e., workplace injury, large smoking population, etc.—it is equally important to integrate productivity losses, regardless of whether they are related to workers’ compensation, group health or disability. Only by doing so can a more comprehensive approach to reducing disability and increasing productivity be possible. IBI