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The real cost of absenteeism — and what you can do about it
It’s natural to keep an eye on the cost of health care premiums. But don’t stop there. Premiums aren’t the only health-related costs that impact your business.
Some costs, like lost productivity when your employees are out sick, go unnoticed. These “indirect costs” can affect your bottom line in ways that are less apparent — but no less real. Productivity losses linked to absences cost U.S. employers $1,685 per employee per year.1
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.
Reducing absenteeism begins with a plan
As you evaluate health plans for your employees, consider how well they can help you minimize absenteeism costs in these areas:
Prevention — Timely screenings for conditions like diabetes, high blood pressure, and colorectal cancer can detect problems before they become serious for your employees. Screenings help your employees stay healthy, and help you reduce or avoid absenteeism.
Condition management — Chronic conditions are among the leading drivers of health care costs for employers. For healthier employees and fewer sick days, consider plans that offer dedicated programs and resources to help your employees stay on top of their chronic conditions.
Employee health engagement — Employees who are actively involved in their health have better outcomes when they get sick. They also save you money. Medical costs can be up to 21% higher for employees with the lowest levels of health engagement.2 Look for health plans that give your employees tools and wellness programs that help them take an active role in their well-being.
When you’re looking at the cost of different health plans, be sure to factor in how those plans will help you minimize indirect costs. Because there’s more to your company’s health care expenses than premiums.
- 1 “Worker Illness and Injury Costs U.S. Employers $225.8 Billion Annually,” CDC Foundation, cdcfoundation.org, January 28, 2015.
- 2 Judith H. Hibbard, PhD, et al., “Patients With Lower Activation Associated With Higher Costs; Delivery Systems Should Know Their Patients’ ‘Scores,’” Health Affairs, February 2013.
Services covered under your health plan are provided and/or arranged by Kaiser Permanente health plans: Kaiser Foundation Health Plan, Inc., in Northern and Southern California and Hawaii • Kaiser Foundation Health Plan of Colorado • Kaiser Foundation Health Plan of Georgia, Inc., Nine Piedmont Center, 3495 Piedmont Road NE, Atlanta, GA 30305, 404-364-7000 • Kaiser Foundation Health Plan of the Mid-Atlantic States, Inc., in Maryland, Virginia, and Washington, D.C., 2101 E. Jefferson St., Rockville, MD 20852 • Kaiser Foundation Health Plan of the Northwest, 500 NE Multnomah St., Suite 100, Portland, OR 97232 • Kaiser Foundation Health Plan of Washington or Kaiser Foundation Health Plan of Washington Options, Inc., 320 Westlake Ave. N, Suite 100, Seattle, WA 98109 • Self-insured plans are administered by Kaiser Permanente Insurance Company, One Kaiser Plaza, Oakland, CA 94612
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