Health & Wellness

What Are the Costs of Chronic Disease in the Workplace?

By Preet Pall on April, 7 2021
7 minute read

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Chronic disease is on the rise all over the world, creating major challenges for both employees and employers. Today, these illnesses cause two thirds of Canada’s health care costs, and 59% of employees with benefits coverage are living with at least one chronic condition.


Why is this important?

As an employer, this can mean increased health plan costs and decreased productivity for your business. To help protect your staff and your bottom line, we’re going to take a closer look at this growing problem and what you can do about it.

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(Related post: How to Support Employees with Chronic Illness)

Chronic Illness Leads to Lost-Productivity Costs

The Public Health Agency of Canada estimates that chronic disease costs the economy $122 billion annually in lost productivity. One reason is that employees with multiple chronic disease risk factors are absent for 50% more days than their colleagues, making it difficult to stay on top of professional responsibilities.

Beyond that, absenteeism can also cause a lot of stress for the rest of the team, as staff are often asked to carry a much heavier load on their coworker’s behalf.

To make matters worse, productivity is also impacted by presenteeism—that is, when unwell employees continue to come to work but are less focused and effective than normal. Because of its impact on productivity, presenteeism can contribute to as much of 18-60% of your total healthcare costs!

What About Increased Health Benefits Plan Costs?

In addition to reducing productivity, unmanaged chronic disease is also the biggest cost driver for benefit plans.

Why is that?

Not only do employees with multiple chronic disease risk factors incur 3-4 times more healthcare costs than other staff members, they also increase the price of providing health insurance for the office. Because these premiums are largely decided based on the previous claims of the group, an illness that affects just one or a handful of employees will often determine what you pay for your entire team.

(Related post: How Can Employers Manage Rising Biologic Drug Prices?)

To get a sense of what this can look like, here are some of the health conditions that cost employers the most, according to IFEPB’s Workplace Wellness Trends 2019 Survey:

  • Musculoskeletal conditions (arthritis, back, carpal tunnel, etc.)
  • Cancer
  • Diabetes
  • Cardiovascular and heart disease

Your Employees Likely Have Risk Factors for Chronic Disease

Fortunately, many of the risk factors for chronic disease are avoidable, such as smoking, high cholesterol, heavy drinking, obesity, poor diet, physical inactivity, and stress.

But here’s the truth:

Despite this fact, many people continue to struggle with adopting a healthier lifestyle:

  • Obesity rates have grown by more than 200% since 1985
  • Approximately one in four Canadians reports a high degree of life stress, and
  • Only one in five adults achieves the 150 minutes of moderate-to-vigorous physical activity per week that is recommended by the Canadian Physical Activity Guidelines.

Prevention: Boost the Health of Your Team and Your Bottom Line

These statistics are worrying. But there are many ways you can help reduce your team’s health risks through preventative measures.

This is good news.

Did you know, a growing number of medical professionals are urging people to review the number and type of prescription drugs they’re taking regularly with their physician? Most chronic diseases are managed with medication, but it’s important to review current prescriptions for effectiveness and possible interactions at least annually.  

In addition, it’s amazing how many of these conditions can be improved or even prevented altogether by exercise, a healthy diet, or stress reduction techniques like mindfulness.

This is one reason why workplace wellness programs can be so helpful.

In 2015, Ivey International Centre for Health Innovation teamed up with Sun Life Financial Canada to investigate the benefits of these programs in their Canadian Wellness Return on Investment Study. They found that these initiatives not only encourage positive, healthy behaviours, they can also reduce chronic disease risk factors.


Of employees who participated in the two-year-long project:

  • 53% said their physical activity level increased
  • 51% said their nutrition improved
  • 23% said they lost weight
  • 23% said they had more energy!

By speaking with a benefits advisor, you can build out an employee wellness program that’s right for your company. It can include features such as:

  • health risk assessments
  • nutrition education
  • sponsored gym memberships and exercise programs
  • mindfulness meditation training for stress reduction
  • weight loss programs
  • support for staff who want to quit smoking
  • even ongoing employee health education, such as newsletters and workshops, to keep your team moving toward their wellness goals.

Final Thoughts

As a caring employer, you recognize that most chronic conditions require a physician’s supervision. And many conditions need prescription medications, which is why you provide support by offering healthcare benefits.

But for conditions that can be improved or prevented, we recommend focusing on helping employees adopt new behaviours, such as increased exercise, through the implementation of a wellness program. This can go a long way toward a healthier, more productive workforce—a bottom line impact for you and your team.

Chronic Disease: The Impact To Your Benefits Plan

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