Obesity in the Workplace Becoming an Issue

Employee obesity has long been an issue that employers have kept at arm’s length, and for good reason. The potential legal and public relations ramifications of calling an obese employee into the office for a heart-to-heart chat about their weight are devastating. Workers’ compensation administrators have tended to shy away from the issue as well, fearing lawsuits and preferring to concentrate on body part injuries rather than the whole person. But now, driven by the costs associated with obesity, employers and workers’ compensation underwriters and administrators are beginning to take obesity into account when determining workers’ comp benefits. 

According to a study by NCCI Holdings of New Jersey, workers who are morbidly obese, defined as having a Body Mass Index of 40+, filed 45% more claims, missed 8 times the workdays and incurred over 5 times the medical costs and 8 times the indemnity costs than did non-obese workers. By comparison, those who were merely overweight, with a BMI of 25 to 29.9, filed 9% more claims, missed 3.5 times as many workdays and incurred 1.5 times the medical costs and twice the indemnity costs than their non-obese counterparts did. 

According to another study, this one from The Conference Board, obesity costs US private employers an estimated $45 billion a year in medical expenditures and worker absenteeism. In fact, their report found that obesity is associated with an overall 36% increase in health care spending, more than either smoking or alcoholism. Also, since 34% of American adults fit the definition of obesity, this is a challenge to companies that has been long in coming and for which there will be no easy solution.

The chief difficulty here is that obesity is considered a medical condition, as opposed to a lifestyle choice like smoking. You don’t need to smoke, that is a choice that adversely affects your health and makes you a greater risk to insure. We already see many companies charging employees who smoke more for their health insurance and there is also a push to get employees to lose weight through wellness programs, but that can open the employer up to legal liability if they are too forceful or insensitive in the way they administer the program. 

There is an approach that avoids the pitfalls of a direct assault on obesity by taking a more holistic approach to dealing with the root causes of disease. It is called Population Health Management. The idea behind it is that you no longer concentrate on the 20% or so of those who drive 80% of the cost of healthcare. Instead, you work to improve the overall health of a defined population—such as your workforce—through needs assessment, delivery of preventive services, condition management and outcomes measurement. It is an approach that aims not at cost reduction, but at cost avoidance. 

David R. Groves, vice president of corporate health management for Comerica Inc. had this to say about his company’s population health management approach: "Cost reduction is great, but it's becoming tougher and tougher, because people are getting older and they do have the chronic conditions. But what you can do to avoid costs is to do the types of programs we're doing." 

More than simply being good for the employees, Population Health Management can be good for your bottom line as well. Take a company like Gordian Health Solutions Inc., a population health management firm based in Nashville, Tennessee. According to their figures, their clients see a 1.7-to-1 return on investment in the first year. In year two, employers can expect a 2-to-1 return on their investment, that is $2 back for each $1 spent; and in year three, they can expect an ROI of 2.46-to-1. These are direct costs. The ROI from increased productivity can be even greater, as much as 2 to 3 times the direct medical cost savings. 

However you slice it, Population Health Management can be good for you, for your employees and your business. For more information, visit MayoClinicHealthSolutions.com.