Obesity Costly for Employers

A new report from the Conference Board shows that obesity costs U.S. private employers a pretty penny – about $45 billion a year in medical expenses and work loss.

The report, “Weights and Measures: What Employers Should Know about Obesity,” examines the financial and ethical questions surrounding whether, and how, U.S. companies should address the obesity epidemic.

The nation’s obesity rate has doubled in the last 30 years, with 34 percent of adult Americans currently fitting the definition of “obese.” Those extra pounds weigh heavily on companies’ bottom lines, consuming 5 to 7 percent of the national health care budget and contributing to a 36 percent increase in health care spending.

"Employers need to realize that obesity is not solely a health and wellness issue," says labor economist Linda Barrington, research director of The Conference Board Management Excellence Program and co-author of the report. "Employees' obesity-related health problems in the United States are costing companies billions of dollars each year in medical coverage and absenteeism.”

Employers Fight Back

Barrington said employers should pay attention to their workers’ weights to ensure employees – and the bottom line – remain healthy.

Many employers already work to combat obesity. More than 40 percent of companies have implemented obesity-reduction programs, and 24 percent said they plan to add such programs in 2008. Obesity-reduction programs can yield a return on investment ranging from zero to as much as $5 for each $1 invested.

Report findings also indicate, however, that awarding cash and prizes for weight loss sometimes may be more effective than devoting resources to long-term wellness programs.

The report cautioned employers against becoming “too intrusive in managing obese employees.” Employers may risk discrimination lawsuits if they are too forceful when encouraging obese workers to manage their weight. And employers considering whether to pay for extreme solutions, such as bariatric or weight loss surgery, should first weigh the pros and cons. While obese workers who are eligible for such surgery typically have higher obesity-related medical costs and absenteeism, companies are not likely to recoup surgery costs before employees leave for other jobs.

Finally, the report pointed out that how employers communicate a wellness or weight-loss program is as important as how they design it. The authors encouraged companies to involve employees in planning new health initiatives and to always maintain the privacy of each worker.

TAGS: Archive Health
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