Blog


A healthy workforce is a more productive workforce
February 04, 2014
   
   
Imagine showing up to work sick. You find it difficult to focus, and you probably donaEUR(TM)t perform at 100 percent capacity. Or perhaps your illness causes you to call in sick. At one time or another, virtually all employed Americans have suffered an illness that made them miss work or perform at a diminished capacity. The resulting loss from absences and lower productivity amounts to a substantial burden on employers, and ultimately, the overall economy. However, for working Americans with chronic conditions (such as cancer, diabetes, heart disease, hypertension, or stroke), as well as their caregivers, the impact is far greater.

A healthy workforce is essential to economic growth. However, chronic conditions depress workforce participation and drain productivity. And the effects are substantial, amounting to billions of dollars of lost GDP every year.

In our recent study, "Checkup Time: Chronic Disease and Wellness in America", the Milken Institute measured the indirect economic impact in the form of lost workdays and diminished productivity for 2008 through 2010. The resulting estimates were compared to projections made in the InstituteaEUR(TM)s 2007 report, aEURoe An Unhealthy America.aEUR?

From 2008 to 2010, aEURoeAn Unhealthy AmericaaEUR? projected an average annual loss to GDP of $1.2 trillion for the combined five diseases in the baseline scenario (which assumed the continuation of then-current trends), and $1.1 trillion in the optimistic scenario. To put these numbers in perspective, $1.2 trillion can double cancer research funding, fund Medicare, Medicaid and the ChildrenaEUR(TM)s Health Insurance Program for a year and still have plenty left for other purposes. Now that data is available for those years, we can write up a aEURoereport cardaEUR? on how the U.S. is doing. Unfortunately, the trend for most diseases is headed in the wrong direction because the actual GDP loss was even more severe than forecast. For all diseases, the shortfall was $16 billion higher than in the baseline scenario, and $107 billion higher than in the best case.

Lost GDP from five chronic diseases

2008-2010 ($ billions)

MilkenInstitute

What do these outcomes represent? The baseline projections assume that risk and demographic factors will follow historical patterns, while the optimistic scenarios assume that risk factors will decline, particularly as behavior change gains traction. However, all conditions except heart disease saw increases in the affected population. That can be explained, in part, by the expanding prevalence of risk factors such as obesity and high cholesterol. For example, the actual adult obesity rate in 2010 was 27.8 percent,[1] greater than either the baseline or optimistic scenarios.

Because health risks have taken daunting paths, the associated economic hit has been worse than expected. HypertensionaEUR(TM)s impact on GDP was much larger than the losses resulting from cancer, diabetes or stroke. We see rising obesity rates and sedentary behavior as among the primary culprits. Because hypertension and stroke have a strong causal link, stroke follows a similar trend, with GDP loss greater than projected. ItaEUR(TM)s true that smoking rates have dropped, but they are doing so too slowly to keep pace with the rising indirect impact of stroke.

The campaign against smoking, however aEUR" along with stiff taxes aEUR" seems to have curbed heart disease. Because there were fewer such cases than projected, there were also fewer employed patients and caregivers, which limited the amount of GDP lost to missed workdays and low productivity. For diabetes patients, many remain employed, which explains why most of the economic burden stems from lost GDP rather than treatment expenditures. Those tallied $182 billion and $46 billion, respectively.

Hardships imposed by chronic disease can snowball into detrimental effects on the economy. So far, the trend reveals heavier burdens than projected, but there is hope on the horizon. The lower than forecast losses due to heart disease show that prevention can make a sizable difference. The time to reverse the trend for other diseases aEUR" to improve AmericaaEUR(TM)s health and its economy aEUR" is now.

--------------------------------------------

1. Self-reported.