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Untreated Alcohol Problems Increase Health Plan Costs

Identifying and treating alcohol problems is good for health plans. Experts predict that the cost of providing employee health insurance coverage will double by 2007 — prompting many employers to consider strategies to help control costs. Increasing access to alcoholism treatment can reduce health care utilization and improve the health of beneficiaries.

How? Alcoholism is a chronic disease with many similarities to asthma, diabetes and high blood pressure. Most employers don't recognize that it typically progresses in stages. Many people aren't aware that brief, inexpensive interventions can help people cut back on their drinking before they become dependent on alcohol. Unfortunately, by the time many people seek help for alcoholism, they require more extensive and expensive treatment. As a result, problem drinking, which can range from a drunk driving accident to acute liver disease, can increase health care costs and have a negative impact on health plans.

The Facts About the Impact of Problem Drinking

Seventy-five percent of heavy drinkers are employed. In fact, nearly 9.6 million people or 9.1 percent of full-time workers ages 18 and above drink in ways that put them at high risk for alcohol-related health problems and reduces their productivity on the job.

Just look at the facts. According to a federal government survey1, people with alcohol problems:

  • say they call in sick or skip work an average of 11 days per year, thirty percent more than those who don't have drinking problems
  • seek emergency room attention 33 percent more often than the rest of the population
  • stay in the hospital over a day and a quarter longer

Who are people with alcohol problems? More often than not, they're young and male, but alcohol-related problems affect people of all ages and women as well as men. Workplaces that actively discourage employees from heavy drinking experience fewer alcohol-related problems. Heavy drinking at night or on weekends often means that employees call in sick, arrive late, leave early or fall asleep on the job. If they work in safety-sensitive positions, impaired job performance due to hangovers can endanger their own lives or those of their colleagues and the public. These consequences of heavy drinking are pervasive: 20 percent of workers say they have been injured, have had to cover for a coworker, or needed to work harder because of coworkers' drinking.

Heavy drinking also affects employee health. It greatly increases the chances of unintentional injury—both on and off the job. Over time, heavy drinking contributes to many serious medical problems including liver disease, stroke and cancer. In fact, according to government estimates, alcohol problems add $36 billion to the nation's health care bill. American business absorbs much of this cost in the higher premiums it pays for employer-based health insurance as a result of unidentified and untreated alcohol problems.

  1. U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration, Office of Applied Studies. 2004. National Survey on Drug Use and Health, 2002. Research Triangle Park, NC: Research Triangle Institute.

How Much Does Problem Drinking Cost?

Health plans may recognize that problem drinking can harm their business. But until now they've had difficulty quantifying its cost. The Alcohol Cost Calculator for Health Plans uses prevalence rates of problem drinking for various industry sectors to broadly measure its impact on specific workplaces.

The profound effect of problem drinking on family life also shows up in health plans. If an employee lives with someone who has a drinking problem, his or her job performance and attendance may suffer. Problem drinking can lead to higher employer health care costs for covering the entire family, not just the person with the drinking problem.

Learn what you can do to reduce the costs of problem drinking.