Cheap (and crappy) health insurance costs businesses more in the long run because employees get sick more often. But businesses still provide cheap & lousy health insurance because they are under intense competitive pressure to generate short-term gains. If the US government provided health insurance for all citizens, people would be healthier and more economically productive. This is what liberalism is all about: everybody makes more money when society invests in people.
New York Times wrote:
June 27, 2007
Scant Drug Benefits Called Costly to Employers
By MILT FREUDENHEIM
Health penny wise, medical pound foolish?
Employers that shift too much of the cost of drugs to workers in their company health plans could wind up losing more than they save, through absenteeism and lost productivity, according to a study by health policy researchers.
The three-year study, to be released today, looked at the medical histories of several thousand workers with a diagnosis of rheumatoid arthritis. The condition is a painful and incurable disease of the joints, but patients can keep it at bay by taking a special class of drugs.
The cost, as much as $18,000 a year, can be a big expense for employer health plans. Still, putting too much of the cost burden on the employee can evidently backfire.
Among the 17 employers in the study, conducted by the nonprofit Integrated Benefits Institute, more than half the workers with rheumatoid arthritis were not taking their drugs — in many cases because they considered the out-of-pocket co-payments too high.
As a result, the institute’s study found, the employers incurred $17.2 million in costs from lost productivity, 26 percent more than the estimate of what they would have spent if the workers had taken their arthritis drugs.
The workers’ co-payments were relatively low, averaging $26 for a 30-day supply, indicating a fairly low threshold before out-of-pocket costs prompted workers to forgo medication....
The arthritis study supports and expands on earlier research that looked at employees of Pitney Bowes, the business services company, and the city government of Asheville, N.C. Those studies found improved productivity and lower medical costs after drug co-payments were reduced or eliminated for diabetes, asthma and heart-related problems....