It’s a study that appears to be done every 15 years with the estimated price tag including direct and indirect costs and counting all externalities to society. It has only been analyzed twice by J. Paul Leigh, a professor of public health sciences at the University of California – Davis, the first using 1992 datasets and the second using 2007 numbers. The increase over the 15-year period was $33 billion.
The 2007 study estimated injury and illness costs as $192 billion for occupational injuries and $58 billion for workplace illnesses.
Employer Health Premiums Rising
Granted, these numbers are a bit dated, but what really caught my eye was the revelation that “less than 25 percent of the costs of workplace injuries and illnesses are covered by workers’ compensation.” The study further concluded that, “As a result, many occupational health issues go unresolved, and the bulk of the costs are absorbed by employer-provided medical insurance.”
His thesis appears solid because, “According to a Kaiser Family Foundation study, employer health insurance premiums increased by more than 50 percent between 2000 and 2005” (a period included in the study). In Kaiser’s 2013 study, it was noted that “annual premiums for employer-sponsored family health coverage have increased 80 percent (since 2003), nearly three times as fast as wages (31 percent) and inflation (27 percent).”
The study, which was funded by the National Institute for Occupational Safety and Health (NIOSH), also highlights how greater attention to workplace safety and health could have broad economic benefits. A copy of the study – Economic Burden of Occupational Injury and Illness in the United States can be downloaded.
Good news on the Horizon?
But there is good news. In their 2013 Employer Health Benefits Survey”, Kaiser found that employer health insurance premiums only increased a modest 4 percent over the previous year. Kaiser President and CEO Drew Altman, Ph.D., stated, “We are in a prolonged period of moderation in premiums, which should create some breathing room for the private sector to try to reduce costs without cutting back benefits for workers.”
If Altman is correct in his admission that health insurance premiums are stabilizing then more companies may be able to use the savings to invest in health and wellness programs for employees.
And an investment in occupational injury and illness prevention does pay off according to a Harvard study, “Several well-publicized case studies have suggested a positive return to employer investment in prevention. For every dollar invested in the program, the employer saves more than the dollar spent. The Citibank Health Management Program reported an estimated savings of $4.50 in medical expenditures per dollar spent on the program. Studies from the California Public Employees’ Retirement System, Bank of America, and Johnson & Johnson have similarly estimated significant health care savings from wellness programs.”
Studies continually find that companies that strategically invest in health, wellness, and ergonomic solutions have consistently recognized a significant ROI over time. As with any investment, it takes some time for the benefits to accrue.
Over our 18+ years of providing corporate employee maintenance and wellness programs we have learned that to effectively measure return-on-investment, you must analyze the numbers from the start. We’ve developed a free, no-obligation, 20+-page CBA that takes the customer on a statistical journey that explains, in detail; what types of injuries and illnesses are occurring in order of incidence, the direct and indirect costs of those injuries, and the solutions that InjuryFree can provide to address those injuries.
Contact us for a no-obligation cost-benefit-analysis if you would like to see the type of return your company can earn on its investment in injury and illness prevention.