Health-related productivity costs are significantly greater than medical and pharmacy expenditures, according to a major new study.

"Keeping employees healthy" has become the primary workforce issue upon which organizations base their benefits planning in 2009. Yet as the recession wears on, employers continue to increase employees' share of health care premiums, a new Watson Wyatt Worldwide survey concludes.

According to Watson Wyatt, health care is "the most relevant item for professionals and the second-greatest payroll cost, second only to salaries." Health care amounts to 7.5 percent to 10 percent of payroll.

Yet, for employers in the United States, poor health among workers is far costlier than they realize, according to a major study published this month (April 2009).

On average, every $1 of medical and pharmacy costs is matched to $2.3 of health-related productivity costs. For some conditions that figure is much greater.

Co-morbidities — employees with multiple chronic health conditions — drive the largest effects on productivity loss. The study calls for further research to better evaluate the impacts of co-morbidities by conditions and combination of conditions.

Link to full ThomasNet News article...