Health care costs have jumped almost 8% for 2025, the highest increase in more than a decade.1 These escalating costs have become a critical concern for employers. When it comes to employee health, cancer remains a costly condition, but more employers are pointing to cardiovascular conditions as their top 3 cost drivers.2 — as well as cost pressures from GLP-1 medications3
Your employees’ overall health affects your bottom line in several ways. When employees are in poor health, they’re likely to need time off work. Or they might work when they’re unwell. This is known as “presenteeism,” and it impairs job performance. Working while sick can delay an employee’s recovery time and increase their risk of future health problems — as well as absences.4 Presenteeism can also occur when an employee is dealing with physical pain, mental health issues, or burnout.
You might be unaware of the financial impact of lost productivity on your business. These indirect costs can affect your bottom line in ways that are less apparent than rate increases — but no less real. Productivity losses linked to absenteeism and presenteeism from chronic illnesses and injuries cost U.S. employers $2,945 per employee per year.5 That number includes sick days, short-term disability, long-term disability, and impaired job performance.
Smaller businesses feel the effect of absenteeism even more, since an employee who misses work due to illness represents a larger percentage of the company’s workforce. It isn’t as easy for a sick employee’s work to be transferred to another person in the department — often, the sick employee is the department.
