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Consequence of Inaction

Health care costs now pose a serious threat to the ability of U.S. businesses to compete in today’s global marketplace. Consider the following:

  • In 2000, private business expense for health services as a percentage of profit was 40 percent before tax and 58 percent after tax.

  • U.S. health care costs doubled from 1990 to 2001, and are projected to double again by 2012. However, based on current trends, CEOs and senior executives expect employer costs to double within the next 5 years.

Hidden Costs of Poor Health

Can your organization afford an impaired workforce?

Most business leaders are unaware that the indirect costs of poor health (e.g., absenteeism, disability, presenteeism) may be two to three times higher than the direct medical costs.7,8,9,10 The true impact of indirect costs on business success is strikingly illuminated by current research in health and productivity management. 7-11 Studies associate poor health with:
  • reduced output (e.g., presenteeism).
  • increased errors and accidents.
  • lower quality of products and services.
  • higher rates of disability.
  • higher absenteeism.

Poor health is risky business

Though the direct costs of poor health continue to spiral upward and clearly must be managed, impaired job performance may well be the greatest risk to your bottom line. Poor health impacts the most precious resource of the organization—the effectiveness and performance of its human capital.


Copyright © 2004, Transformations' 5 Step, Inc.