Survey Figures Total Health, Productivity Costs Per Employee

According to the 1999 Health and Productivity Management Benchmarking Survey, health and productivity costs per employee are estimated at $9,992.

According to the third annual 1999 Health and Productivity Management Benchmarking Survey, health and productivity costs per employee are estimated at $9,992.

One hundred benefit managers and other leaders from health and productivity management (HPM) gathered in Washington, D.C., last month to review results of the survey.

The $9,992 figure represents the combined direct costs of group health, turnover, unscheduled absence, non-occupational disability and workers' compensation.

The study examined health benefits information and productivity data supplied by 43 large private and public employers.

The purpose of the study was to gather and communicate key HPM metrics across industry groups, quantify potential savings opportunities, and provide actionable targets for improvement for employers.

Other key findings include:

  • When indirect costs are added to direct HPM program costs (i.e., costs associated with lost productivity for workers who are not at work) total direct and indirect costs are estimated at $13,277 per employee per year.
  • The opportunity for cost savings is higher if the $323 of additional direct costs identified in the study are added to the total HPM costs for programs such as employee assistance, health promotion, occupational medicine and safety.

"In today's increasingly competitive marketplace, corporate leaders are seeking new ways to reduce total operating costs while improving profitability and shareholder value," said Sean Sullivan, president of The Institute for Health and Productivity Management . "Improvements in HPM performance can have a significant impact on the bottom line as well as the health and well-being of the workforce."

The number of corporate contributors more than doubled from last year, making this consortium of employers the largest ever to study total HPM costs and establish benchmarks for improvement.

Each participant received a confidential, customized estimate of potential cost savings they could use to establish a business case for adopting more comprehensive HPM business strategies.

Recommended action steps were also provided based upon the real world lessons learned from three years of the study.

The study was conducted by The MEDSTAT Group, The Institute for Health and Productivity Management, and the American Productivity & Quality Center.

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