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IBI Research Finds Employers Severely Underestimate the Prevalence and Lost Productivity Costs of Depression
Date:5/28/2009

Lost productivity for depression sufferers is a considerable and largely undetected problem

SAN FRANCISCO, May 28 /PRNewswire-USNewswire/ -- Employees disabled by depression are away from work significantly longer than other employees on disability leave according to new research by the non-profit Integrated Benefits Institute. The true lost-time costs of these cases -- including disability payments and lost productivity -- are 2-1/2 times the costs of medical care and pharmacy benefits combined; lost productivity is the largest single cost component, making up 60% of these "full costs." In addition, the research finds that twice as many employees develop depression after filing a disability claim, and again lost productivity is the biggest single cost driver of these disabled employees.

But most significantly according to the research, lost productivity is greatest for those employees still at work as more than 80% of all productivity losses for depressed employees are associated with sick leave and presenteeism (employees who are not fully functioning while at work due to ill health).

"Our results show that depression is a case in point for employers wanting to improve the health of their workforce while improving business results: a huge potential for lost productivity, yet not on employers' radar screens from the paid-cost standpoint," said Thomas Parry, PhD, president of IBI. "A short-sighted focus on paid benefits causes employers to underestimate the true impact of depression on the workforce and fail to make appropriate investments in improving workforce mental health. Such an investment, reflecting the full costs of workforce depression, would benefit employers and their employees alike."

The analysis examines the relationship between depression, disability and productivity and presents unanticipated employer costs and significant challenges. The new study comes at a critical time for U.S. employers struggling to improve both the productivity and health of their employees as they work to remain competitive in the global economy. Depression-related short-term disability (STD) claims can be expensive, extended and hard to manage; they also are common and constitute the second leading cause of disability worldwide.

A summary of the report, The Full Costs of Depression in the Workforce, is publicly available and can be accessed on IBI's Web site: https://ibiweb.org/UserFiles/File/Depression_Brief.pdf.

Key Findings

  • Approximately 10% of the more than 400,000 workers studied received medical treatment for depression during the three-year study period.
  • Only 30% of workers reporting depression receive current professional medical care according to employee self reports.
  • Nearly two-thirds of depression-related productivity losses are due to presenteeism.
  • Employees in the depression group have 44% more lost time than employees who had no depression treatment during their disability leave which cost employers $3,408 more per case.

IBI's Employer Member Solutions Board Recommends

"Increase early depression screening for disability sufferers," recommends IBI's Member Solutions Board, a group of employers and suppliers that review research findings and provide actionable recommendations. The Board for this research also suggests that employers engage a disability supplier to look at claims horizontally and get beyond the disability diagnosis to probe for claimant family and social or work/life issues. Mental health parity requirements represent an opportunity for employers to fine-tune mental health benefits and treatment as a productivity instrument.

For this study, IBI used an Ingenix master research database on 400,928 unique employees from six companies, distributed across all ten geographic regions of the U.S. and a large, national database from employee self reports using the Health and Work Performance Questionnaire (HPQ), a tool developed by Dr. Ronald Kessler of Harvard Medical School and the World Health Organization.

About the Integrated Benefits Institute

The Integrated Benefits Institute (IBI) provides employers and their supplier partners with resources for proving the business value of health. As a pioneer, leader and nonprofit supplier of health and productivity research, measurement and benchmarking, IBI is a trusted source for benefits performance analysis, practical solutions, and forums for information and education. IBI's programs, resources and expert networks advance understanding about the link between -- and the impact of -- health-related productivity on corporate America's bottom line. For additional information visit: ibiweb.org.

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Thomas Parry

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SOURCE Integrated Benefits Institute
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