Unhealthy choices cost company health care plans billions of dollars

December 10, 2015

ANN ARBOR—One out of every four dollars employers pay for health care is tied to unhealthy lifestyle choices or conditions like smoking, stress and obesity, despite the fact that most large employers have workplace wellness programs.

In the largest study of its kind, researchers from the University of Michigan looked at 10 modifiable health risks in roughly 223,500 people across seven industries, said Michael O’Donnell, first author on the study and director of the
U-M Health Management Research Center at the School of Kinesiology.

Modifiable risks are conditions or behaviors that employees can improve or eliminate by making healthier choices. Obesity was most prevalent and cost employers the most money, followed by stress and use of mood-altering drugs. Other risks included seatbelt use, exercise, tobacco and alcohol use, blood pressure and cholesterol.

The results illustrate the substantial savings employers might realize by reducing or eliminating those risks through workplace wellness programs, O’Donnell said.

“There are hundreds of well-designed programs, but thousands of programs that are too superficial to have an impact,” O’Donnell said. “The best programs increase awareness about the link between lifestyle and health, motivate people to change and build the skills necessary to do so, and provide opportunities to practice a healthy lifestyle.”

The goal of wellness is to prevent disease from occurring in a way that saves money, O’Donnell said. Many previous studies have shown that successful wellness programs result in healthier employees and save more in medical care than they cost to design and implement.

“Employee wellness programs are a win-win for employers and employees. If employees improve their lifestyle, they feel better and reduce their chances of getting sick,” O’Donnell said. “Costs go down for employers and their employees, or at least costs do not increase as much as they would otherwise.”

The U.S. has worse health outcomes than most other developed nations, despite spending almost twice as much on health care.

“Medical care costs are out of control in the U.S. and also for employers,” O’Donnell said. “This makes it difficult for some businesses to compete globally.”

U-M researchers also found that the extra cost associated with modifiable risks was about the same for healthy employees and those with chronic conditions—which means employers can save money by helping those workers reduce existing health problems.

The average health care cost for a healthy employee was roughly $3,000, and roughly $10,000 for an employee with at least one medical condition, the study found. Modifiable behaviors and conditions accounted for about $750 for healthy employees, and about $2,600 for those with pre-existing health problems.

The study is scheduled to appear in a forthcoming issue of the Journal of Occupational and Environmental Medicine. Co-authors are Alyssa Schultz and Louis Yen of the Health Management Research Center.


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