Economic Effects of Preventable Health Conditions Costs and Workplace Implications

The healthcare costs have continued to escalate, thus remaining one of the primary contemporary issues in the medical industry and one of the the greatest concerns for healthcare professionals, insurance companies, and employers. The United States is known as one of the countries with higher healthcare spending than any other nation across the world. The preventable illness makes about 80% of the burden of the diseases and 90% of the healthcare costs (Center for Disease Control and Prevention, 2015). In the United States, the total expenditures rose to $1 trillion in 1997. The average cost per person was approximately $3,925 the same year. Additionally, the country spends not less than $1.5 trillion of medical cost on diseases such as cancer, heart disorders, and diabetes (Center for Disease Control and Prevention, 2015). Furthermore, analytic studies indicate that the United States spend $80 billion on treatment of obesity. Currently, each American spends more than $6,000 yearly on healthcare (Center for Disease Control and Prevention, 2015). Such outcome is primarily attributed to the increase in chronic diseases such as obesity. In particular, some of the preventable conditions have increased by 42% in the last ten years (Center for Disease Control and Prevention, 2015). Consequently, such situation has led to considerable workplace implications, especially those related to productivity. The increase in the incidence of preventable diseases caused the decrease in healthcare providers’ productivity due to the increased stress, particularly given the fact that the healthcare industry is currently characterized by fewer practitioners, which impacts their ability to care for the families and ability to complete their responsibilities diligently.

The Business Case for a Health and Wellness Program

Employees who live healthier lifestyles often ask less sick leaves, show improved performance, and allow for decreased health insurance costs, while the ones subjected to higher risk factors, including smoking, being overweight, and having diabetes, increase the needed costs and waste more on healthcare (Austin & Aaron, 2014). In addition, the workers at lower risk are less likely to come down with injuries than unhealthy individuals. Additionally, workplace wellness program is not only associated with increased employee productivity, but also improves morale, which contributes to the success of the organization (Austin & Aaron, 2014). Overall, the wellness program is a fundamental element of motivating employees, thus being vital to the performance of the company.

The wellness program is one of the major drivers for return on investment for employers, including two major components facilitating the accomplishment of this objective (Mattke et al., 2014). The first approach is reducing the employers’ average care costs by about $30 for each member per month, while the second one is allowing the involvement of employees to promote saving through reducing absenteeism. Most companies reduce costs related to absenteeism by approximately $2 million a year (Austin & Aaron, 2014). Additionally, the employers can thus spend less money on the workers as compared to the earlier times since the program encourages the employees to take good care of their health. Another way in which the wellness programs help the employers is by focusing on other changes in the coverage of healthcare. For example, the employees may complain when an organization tries to decrease payments through higher cost sharing, thus limiting the hospital’s and doctors’ choices (Mattke et al., 2014). However, the program helps companies reduce costs by encouraging people to become healthier. Employers are vesting interest in workplace wellness program to reduce unnecessary medical costs, thus increasing their profitability. Therefore, the wellness program can help employers to achieve the long-term saving.

When employees are ill, they may not devote enough time to perform their responsibilities (Austin & Aaron, 2014). The workers may be present at the workplace physically, but be mentally absent, which can affect productivity due to reducing attendance. If the wellness program included weight loss, it would lower the number of sick days. Furthermore, education program is another approach that has proven effective as it allows workers to carry their responsibilities more effectively while handling patients in dangerous conditions such as communicable diseases (Austin & Aaron, 2014).

Future Workplace Trends for Wellness Programs

Current data shows that 70% of the employers are already offering wellness program, while 8% are expected to do so in the coming year (Soberg, 2016). More and more companies are expected to invest in the workplace wellness program because this initiative supports their employees’ desire to improve and create healthier workplace. In addition, such approach is perceived as a means of reducing costs related to employees’ medical expenses. Furthermore, businesses are anticipated to incorporate more than 13 million fitness-tracking devices into their wellness program by 2018 (Soberg, 2016). Similarly, other scholars indicate that the costs for the corporate wellness programs will stand at $8 billion and are expected to grow by 7.8% by 2021 (Soberg, 2016). At the same time, the global workplace will adopt 9% more workplace wellness programs in their jobs (Soberg, 2016). Recent statistics illustrate that more organization are going to offer incentives, gather biometric data, and track result of their employees’ performance based on the offered wellness program.

References

Austin, F., & Aaron, C., (2014). Do workplace wellness program work? Usually not. The New York Times. Retrieved from https://www.nytimes.com/2014/09/12/upshot/do-workplace-wellness-programs-work-usually-not.html

Center for Disease Control and Prevention. (2015). “Chronic disease prevention and health promotion”. Retrieved from https://www.cdc.gov/chronicdisease/overview/index.htm

Mattke, S., Liu, H., Caloyeras, J., Huang, C. Y., Van Busum, K. R., Khodyakov, D., ... & Broderick, M. (2014). Do workplace wellness programs save employers money? Available at https://www.rand.org/content/dam/rand/pubs/research_briefs/RB9700/RB9744/RAND_RB9744.pdf

Soberg, B., (2016). The future of workplace wellness programs. ColoradoBiz. Retrieved from http://www.cobizmag.com/Trends/The-future-of-workplace-wellness-programs/