Alert
COVID-19: Latest updates about the vaccine, testing, how to protect yourself and get care.
 
Kaiser Permanente Business Home Page
Article header

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 engagement — Engaged employees miss fewer work days due to health issues. Research finds that engaged workers cost employers less in lost productivity than disengaged workers — a savings up to 85% or $108.44 per employee per month.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.

Also See

3 Reasons to Offer Employer-Sponsored Health Coverage

Why Workplace Wellness Matters

LinkedIn icon

Follow us on LinkedIn

  • 1 Workplace Health Promotion, CDC, cdc.gov, February 2, 2017, cdc.gov/chronicdisease/resources/publications/aag/workplace-health.htm.
  • 2 Jim Harter and Amy Adkins, “Engaged Employees Less Likely to Have Health Problems,” Gallup.com, December 18, 2015, news.gallup.com/poll/187865/engaged-employees-less-likely-health-problems.aspx.