While healthcare spending may seem unmanageable, reducing the “hidden costs” of healthcare is under your control.
It’s no secret that the cost of healthcare in the U.S. continues to rise year after year. It’s the country’s largest industry by gross domestic product (GDP) and is projected to rise 5.5 percent each year. In fact, healthcare costs are expected to reach $5.7 trillion by 2026, making up 20 percent of the nation’s GDP.
For many U.S. employers, healthcare costs represent the fastest-growing and second-largest operating expense after employee wages. Today, companies nationwide spend $18,000 per employee on annual healthcare expenses, and this is expected to double by 2030. So, what can employers do to minimize costs?
While healthcare spending may seem unmanageable, reducing the “hidden costs” of healthcare is under your control. Hidden costs include employee disengagement, turnover, and lack of productivity. When designed effectively to support and bolster employee health and wellness, the physical working environment can reduce costs. According to the Centers for Disease Control and Prevention, this cost reduction can reach $1,685 annually per employee.
By focusing on the following four key drivers of U.S. healthcare costs, design strategists can help businesses create employee-centric and healthy workplace environments that increase productivity, happiness, and retention.
Employees are living more sedentary lifestyles than ever before. Physical inactivity in the workplace can negatively affect the mood, focus, and productivity of team members. It can even lead to chronic diseases. To promote workplace health and wellness, consider incorporating the following design strategies in the office:
- Sit-Stand Desks: Research shows that standing while working—even for 30 minutes at a time—can have a major impact on health. Benefits include reduced back pain, lower risk of heart disease, less weight gain and obesity, lower blood-sugar levels, improved mood, and higher levels of energy. Many businesses are integrating sit-stand desks to enable workers to alternate between sitting and standing throughout the day. Some employers are using automated sit-stand technology to encourage employees to sit, stand, and move all at the same time, making it a team effort rather than an individual choice.
- Stair Use: Taking the stairs can provide significant rewards for both employers and employees. Stair climbing is an effective yet short burst of activity that increases heart and lung capacity and burns more calories than jogging. When designing an office layout, consider incorporating a centrally located staircase with natural lighting, unique artwork, and music. To encourage stair use, place infographics and signage nearby to promote the health benefits.
- Walking Meetings: Encourage workers to turn their conference-room meetings into collaborative and engaging walking meetings. Moving meetings not only allow employees to integrate physical activity into their workday, but this type of movement also improves energy levels, sparks inspiration, and enables workers to make stronger personal connections.
According to The American Institute of Stress, nearly 80 percent of all U.S. workers suffer from stress and anxiety while on the job. Stress significantly impacts health, and work-related stress is currently costing employers up to $300 billion a year due to accidents, absenteeism, and employee turnover, in addition to medical, legal, and insurance fees. While stress is often caused by job demands, a poorly designed work environment can be a contributing factor. To reduce stress and stress-related healthcare costs, businesses should consider implementing the following design strategies:
- Acoustics: One of the most important factors in office design is noise mitigation. From telephones to machinery to conversations, disruptive noises affect concentration and productivity. Studies show that excessive noise contributes to stress, fatigue, and poor cognitive performance. To minimize noise distraction, consider installing sound barriers, using white-noise machines, or incorporating sound-absorbing materials like carpet, window coverings, and soundproofing insulation. For highly focused work, offer enclosed offices and workstations.
- Biophilia: Biophilic design, the infusion of direct and indirect natural elements into the built environment, helps fulfill our instinct to connect with nature. This holistic approach to design offers many health benefits from decreasing stress and lowering heart rates and blood pressure levels to promoting creativity and boosting overall mental and physical well-being. Examples of biophilic design include daylight, plants, natural ventilation, and water elements.
- Stress-Management Seminars: As research continues to highlight the effects of employee stress on a company’s bottom line, stress-management programs and seminars have become more popular. Through stress-management techniques, tools, resources, and training, employees are learning to overcome business-related stress, and in turn, companies are benefitting from reduced stress-related expenses.
The CDC Foundation reports that cigarette smoking among U.S. adults has declined more than 50 percent over the last 50 years; however, nearly 20 percent of the U.S. workforce still smokes cigarettes, exposing nonsmokers to second-hand smoke and costing businesses $5.6 billion in lost productivity. The following strategies can help reduce tobacco-related health issues and associated costs:
- Communicate the Risks: Increase awareness of tobacco-related health risks by displaying infographics throughout the workplace and leveraging technology to educate workers about the hazards of first-, second-, and third-hand smoke. Third-hand smoke, a relatively new concept, is residual nicotine from smoke left on indoor surfaces (i.e., furniture, walls, carpets, etc.). Touching contaminated surfaces or breathing in the off-gassing from these surfaces can expose employees to harmful chemicals.
- Smoke-Free Zones: If your workplace is not tobacco-free, consider establishing smoke-free zones to reduce exposure to second- and third-hand smoke as well as emissions from e-cigarettes and other electronic nicotine devices. This includes installing “No Smoking” or “Tobacco-Free” signs at office entrances and on walkways. Smoke-free zones should include indoor areas (even those enclosed or ventilated), spaces outside and near building entrances, and inside all work vehicles.
- Prohibit Smoking: A tobacco-free workplace is a safer and healthier work environment that reduces direct healthcare costs for employers. Smoke-free work environments also reduce the risk of fires and renovations; increase the possibility for businesses to negotiate for lower life, disability and health coverage; and in the long run, can save on building maintenance costs. Research shows that companies allowing on-site smoking spend nearly $728 more per 1,000 square feet in annual office maintenance than companies with smoke-free environments.
Food Choices and Portion Control
More and more businesses are providing workers with access to cafeterias, fully stocked kitchens, and complimentary drinks and snacks as an employee benefit. Data shows that food-related perks can improve employee morale and help keep workers energized, comfortable, and on-site longer. Accordingly, employers should ensure that the food they provide has adequate nutritional value with low amounts of sodium and refined grains.
Why should employers care? Healthcare costs. Unhealthy and overweight employees can cost an employer at least $450 more per year in medical expenses. Businesses can encourage employees to make healthier choices in these three ways:
- Nutrition and Health Education: Educate employees about the importance of a balanced diet and invite nutritionists and healthcare professionals to provide tips and resources via on-site seminars. Reinforce healthy decision-making by hosting cooking demonstrations, providing discounted consultations with nutritionists, and offering employees access to a wellness library filled with cookbooks and magazines about healthy eating and living. For larger organizations, perhaps incorporate health fairs where employees can get their BMI checked, take part in cooking classes, and receive on-site health advice.
- Healthy Options: It’s essential that businesses provide workers with the opportunity to make healthy choices. Consider providing employees with healthy options, such as fruit, yogurt, and tea, instead of soda, candy, and chips.
- Serving Sizes: The need for portion control often plagues employers who have cafeterias and full-size kitchens where snacks are stored in large bins. To help prevent overconsumption, leverage the WELL Building Standard® for nutrition. For example, a WELL-certified space regulates portions. Serving sizes include 10 inches for a circular plate and 16 ounces for bowls and cups. This simple practice can go a long way toward encouraging healthy eating habits among employees.
As healthcare costs increase across the country, businesses should consider how to integrate employee health and well-being into the office environment. Through effective workplace design strategies, we can decrease stress and tobacco use, increase physical activity, and empower employees to make positive and healthier food choices. Thoughtful design can prevent turnover, absenteeism, and disengagement. For every dollar a company invests in employee health and wellness, medical and absenteeism costs drop $6, making the office environment itself a strategic tool for business success.