Global rates of obesity, diabetes, and other chronic diseases are on the rise. Over 65% of Americans are overweight, and by 2020 it is estimated that half of all Americans will suffer from a preventable, chronic disease. The United States alone spends over $2.5 trillion every year on healthcare, with a large portion of that money coming from employers’ pockets for employee health insurance, medical leave, and sick days. Taking proactive measures to get your employees healthy and create a healthy corporate culture are paramount to companies’ long term financial health and wealth.
Q. What does prevention mean for business?
A. Prevention means lower healthcare costs for employers.
With employers covering healthcare costs for 160 million non elderly American workers,
preventing disease and improving health outcomes is a financial imperative for many businesses.
Healthcare costs for smokers, people who are obese, and those who have diabetes are
$2,000, $1,400, and $6,600 per year higher for each person with these conditions, respectively.
Healthcare costs saved from preventing these diseases reduce health insurance premiums.
A 1% reduction in health risks such as weight, blood pressure, glucose, and cholesterol risk factors
would save $83 to $103 annually in medical costs per person, much of which could accrue to employers
in reduced premiums.
Medical costs are reduced by approximately $3.27 for every dollar spent on workplace wellness
programs, according a recent study.
Q. What does prevention mean for productivity?
A. Prevention means greater worker productivity.
Healthier workers provide continuity for businesses, with fewer disruptions due to absence, greater
day‐to‐day productivity, and less need to replace institutional memory and train new employees.
Indirect costs to employers of employee poor health—lower productivity, higher rates of disability,
higher rates of injury, and more workers’ compensation claims—can be two–three times the costs
of direct medical expenses.
Workers with diabetes average two more work days absent per year than workers without diabetes.
Absenteeism costs are reduced by approximately $2.73 for every dollar spent of workplace
Preventing disease increases productivity—asthma, high blood pressure, smoking, and obesity each reduce annual productivity by between $200 and $440 per person.
Research from the Milken Institute suggests that a modest reduction in avoidable risk factors could lead
to a gain of more than $1 trillion annually in labor supply and efficiency by 2023.
Q. What does prevention mean for global competitiveness?
A. Prevention means stronger global competitiveness.
Untreated or preventable illnesses impose significant monetary and productivity costs on U.S. companies.
Increases in productivity due to better health have a positive impact on GDP growth.
Findings from the United States, Canada, and Indonesia have shown that as the price and availability
of heath services improve, labor force participation and hourly earnings increase.