The Business Case for Supporting Employees' Addiction Treatment

Helping your staff get the help they need has a financial cost, but produces tangible returns

Written by Chris Dawson

A few years ago I met a mid-level supervisor who had just gone off on short-term disability. It was yet another episode in what amounted to almost 150 days of lost work over three years—clearly the result of an addiction issue.

While this individual was highly regarded by peers and management, he had a problem, and his employer was running out of patience. They wondered why he wasn’t getting the help he needed. In most cases such as this one, the answer isn’t simple. Addictions can be complicated by mental health disorders, social influences, financial challenges and workplace stresses.

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Addiction and mental health issues have emerged as one of the most significant 21st century occupational health challenges. In any given year, one in five Canadians experiences a mental health or addiction problem. Addiction costs the country’s economy billions annually, with the majority of this economic impact caused by workplace absences and lower productivity while at work.

When it comes to tackling these issues, employers would be wise to take a page from the Armed Forces’ playbook, which has long recognized the need to support treatment for its members. For the Forces, a clear moral responsibility is augmented by a basic fiscal reality: recruitment is costly, and keeping members healthy makes good economic sense.

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Unfortunately Canadian employers have not kept pace with the Forces, or even their counterparts in the U.S. when it comes to paying for treatment. While most employees in Canada can take advantage of benefit plans supporting everything from dental to hospital accommodation, relatively few employers pay for support for addiction or psychiatric care.

In the U.S., more than two-thirds of individuals treated for addictions receive some level of insurance support, whether public or private. In Canada, the inverse is true—most residential addiction treatment is self-funded.

In much the same way as the introduction of the most basic health and safety regulations in the early 20th century led to a precipitous drop in on-the-job fatalities, there is much that must be done today to tackle the challenge of addiction in the workplace.

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Some employers have invested in the development of substance-free workplace policies, while others have taken the important step of educating and training management and staff. While all are worthwhile initiatives, in our experience the best ROI comes from is investing in treatment itself.

A major Canadian retail chain recently realized significant savings when it chose to play an active role supporting treatment for its employees. Here’s what it found: At an average treatment cost of about $10,000 per employee (as a weighted average for both outpatient and inpatient or treatment care), the company recorded an $8,000 return after the cost of treatment. Savings were realized in reduced absences, fewer instances of long-term disability, higher productivity and lower managerial distractions and recruiting/turnover costs.

Indeed, our organization’s work with a select few Canadian employers suggests that similar benefits could be available for as little as $100 per employee per year. Compare that to dental coverage and you begin to get the idea.

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The same proved true for the mid-level supervisor on short-term disability, after his employer finally agreed to pay for treatment. And as is often the case, while addiction was clearly the primary issue, mental and physical illnesses were also present. The treatment he received was both rigorous and comprehensive, and led to significantly improved health and a good prognosis for sustained recovery.

Post treatment, this supervisor has happily returned to work, and has been absent for only four days over the two years since. For his employer, someone who could have been another case of long-term disability has gone back to being a valuable, and healthy member of the team.

It turns out that healthier employees are less expensive employees. For addictions and mental health issues, getting help is a whole lot easier when treatment is funded. It’s always great when good employee relations also make good business sense.

Chris Dawson is CEO of the Edgewood Health Network.


Have you had to contend with employee addictions? Share your experiences using the comments section below.

Originally appeared on PROFITguide.com