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Published July 2007
Although most organizations consider health care costs, they tend to ignore the fact that up to two-thirds of an organization's costs are indirect. These costs often carry long-term impact such as absenteeism, "presenteeism" (the employee is at work but not 100 percent effective because of poor health or extreme fatigue), workers' compensation and short-term disability.
Chronic conditions such as high blood pressure, diabetes, irritable bowel syndrome and stress all lead to absenteeism and reduced productivity. Although health benefit costs increased an average of 10 percent in 2006, more employers are adopting health management programs to help control costs — in part by getting employees involved in disease- and lifestyle-management programs aimed at obesity, inactivity and smoking cessation.
Increasingly, today's most successful businesses understand that investing in their employees' health and well-being can have tremendous bottom-line results, including increased retention, improved performance and reduced costs because of health insurance, accidents and absenteeism.
For example, the 2005 Mercer National Survey of Employer-Sponsored Health Plans revealed 62 percent of large employers rated health and productivity management as a significant or very significant cost management strategy for the next five years.
Lifestyle-Modification Coaching
Consultation regarding lifestyle behaviors has seemed to be part of the domain of physicians, psychologists and other health professionals — not that of executive coaches. But coaches who attempt to increase effectiveness and performance of clients should consider coaching for lifestyle modifications.
The increasing prevalence of work stress, job-family imbalance and chronic health problems has a direct adverse effect on individuals and organizations. In two recent Envisia Learning studies, employees in a large aerospace and public utility organization who exercised more regularly, practiced positive overall health habits and used appropriate emotion-based coping reported significantly less absenteeism because of physical illness, less burnout and greater job satisfaction at the end of one year.
One of a coach's biggest challenges is to link an employee's health goals to an organization's profitability and productivity goals. Despite the challenge, health and productivity management (HPM) research suggests investments in the overall health of an employee do contribute to the organization's bottom line.
For example, individuals on disability comprise about 10 percent of all employees, but they account for more than 50 percent of all employee health costs in most organizations.