Employees with diabetes are pummeling the bottom lines of American business to the tune of $175 billion a year in direct medical costs. Factor in the indirect costs and the costs climb even higher.
The nonprofit business association Northeast Business Group on Health took a look at those numbers a year ago and decided to take action.
Recommended For You
After researching the issue, and a summit on the subject last summer, the association has issued the first of what it promises to be a series of white papers derived from its research.
In its initial publication, the group presented the argument for corporations to take a more strategic approach to addressing diabetes within its employee population. It noted that the disease affects about 10 percent of the U.S. population, a figure that some researchers say could rise to 33 percent by 2050. It quantified the cost to business—more than $175 billion in medical costs paid by corporations, "with indirect costs accounting for an additional nearly $70 billion."
When a company medical plan effectively addresses diabetes, NEBGH said, studies have shown that "for each dollar spent on diabetes management, employers enjoy a $4 return on investment."
Given those pieces of financial information, the association said, the time has clearly arrived for corporations to work together to develop better strategies for helping workers manage their diabetes. And executives are ready for a better approach, according to the results of a survey conducted in July. But they need more guidance, because current strategies just aren't delivering the needed outcomes.
"Nearly half of the senior benefits professionals who responded said diabetes is one of their top three concerns, and 85 percent currently have a diabetes prevention or management program in place (or plan to start one in 2015). However, employers were split down the middle in terms of their satisfaction with the effectiveness of these programs, and the majority of employers said they're not sure whether such programs deliver a good return on investment."
Among the other findings of the survey:
- Indirect costs: Employers feel that disease-related disability because of diabetes-related complications is the most important indirect cost associated with diabetes (89 percent), followed by loss of productivity (39 percent) and absenteeism (34 percent).
- Identifying diabetes risk: Screening of employees through examination of medical claims was used by most employers for identifying diabetic employees or those at risk (79 percent), with many also using biometric screening (56 percent) and Health Risk Assessment (45 percent). Employees who are identified are most often encouraged to participate in programs, with a few employers offering economic incentives for doing so.
- Measuring success: Respondents were asked how they measure their program's success, and by far, the most common measure was participation rates (79 percent), followed by overall total claims costs for those with diabetes (50 percent). Achievement of clinical measures was cited by 36 percent of respondents.
- Emotional barriers: By far, employers pointed to employee reluctance to engage in lifestyle modification and other self-care programs because of stigma, embarrassment and lack of motivation. These emotional barriers contribute to low participation in diabetes programs; low awareness of the importance of diabetes that keeps employees from actively seeking out available programs was cited as another major obstacle.
"Employers are aware of the toll diabetes takes on their employees, as well as the impact to their organizations in terms of direct health-care costs and indirect costs associated with diabetes-related absenteeism, presenteeism, disability and early retirement," said Laurel Pickering, MPH, President and CEO of NEBGH. "But we need to look beyond what is currently in place in most organizations and actively pursue innovative new models of care delivery, new ways of engaging employees and new business models that reward high value care, if we are serious about making a dent in this American epidemic."
The NEBGH said its next phase of the project "will explore – in greater detail – the opportunities highlighted here, examine key features and elements essential for implementation of innovative approaches to diabetes management in the workplace, and develop an actionable framework for employers to endorse and pursue."
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.