About this Blog: This is the first of a two-part blog that takes a 360-degree look at diabetes, one of the leading drivers of health benefit spends. In this blog, we give an overview of the profound impact diabetes is having on the workplace. In blog two, we will share cost-effective strategies employers can use to help employees prevent and manage the disease, while controlling benefit costs.
What employers should know about diabetes
Diabetes is a chronic and sometimes fatal disease that is at an epidemic level in Canada.
Currently, there are 11 million Canadians living with diabetes or prediabetes - a number that has doubled since 2000. By 2020, over one-third of Canadians will have type 2 diabetes or be prediabetic, at which time the economic impact of diabetes in Canada is projected to reach $16.9 billion, up from $6.3 billion in 2000.
Rising drug costs - The trends are reflected in our own data. Over the past 10 years, we have seen a 52% increase in the number of plan members per capita claiming for medication to treat type 2 diabetes. During this same 10-year period, the cost of a prescription drug claim for type 2 diabetes has increased by 46%.
Note: 90% of diabetes claims are type 2, in which the body cannot control the amount of sugar in the blood. Type 1 diabetes accounts for 5-10% of all claims and occurs when the body can’t absorb sugar in the blood at all.
Most costly chronic condition - Diabetes tops all chronic diseases for treatment costs. In fact, the average drug cost for a diabetes claim is four times higher than that of a claim for mental health. The average drug cost per Atlantic Canadian claimant is $1,278 for diabetes, compared to $327 for mental health. This does not include disability costs, or loss in productivity due to absenteeism and presenteeism.
Hurting the bottom line - The implications of these trends are significant for Canada’s employers. Consider these statistics from the Diabetes Canada:
- More than 20 people are diagnosed with the disease every hour of every day
- Over half of all new cases of diabetes affect people of working age
- People with Diabetes have medical costs up to three times higher than other Canadians
- Employees with diabetes are absent 2 to 10 days more per year than their co-workers
- Employees with diabetes are three times more likely to have to retire early due to illness than their co-workers
In short, the growing prevalence of diabetes in the workplace is taking a huge toll on everyone.
Leading causes - So what is fueling this epidemic?
- Rising Obesity Rates: Approximately 60% of Canadians are overweight
- Increasingly sedentary lifestyles: 50% of Canadians over age 12 are inactive
- Rapidly Aging Population: Sharpest increase in diabetes occurs after the age 40
Cost drivers – The growing prevalence of diabetes in the workplace is exacerbated by the rise in treatment costs. This is due to new innovative drug treatments and combination therapies launching to market.
Multiple therapies - We’ve gone from using just two classes of drugs to treat diabetes (sulfonylureas and metformin) to employing multiple therapies in varying combinations with hundreds of drug options to choose from. Over the past 10 years, the percentage of plan members using three or more drugs to treat diabetes has increased from 14% to 26%.
As a result, the total spend for treatment, including supplies, now accounts for 13% to 15% of a benefit plan’s total drug costs.
Left unmanaged, diabetes can lead to downstream complications, many of which drive workplace disability claims.
- Heart Disease - People with diabetes are 2 to 4 times more likely to develop heart disease and stroke
- Blindness - Diabetes is the leading cause of blindness in people younger than 65 years of age
- Kidney Failure - One-third of people who have had diabetes for 15 years or longer will develop kidney failure
- Depression - 30% of people with diabetes suffer symptoms of depression; 10% experience major depression
- Nerve Damage - 7 out of 10 non-traumatic limb amputations are caused by diabetes-related nerve damage
While diabetes may not be the primary diagnosis in regards to a disability claim, it is often a secondary condition that can adversely impact the speed of recovery and return to work.
The drug costs associated with the treatment of each of these complications are significant.
We’ve painted a pretty grim picture of the big hit that diabetes is taking to the bottom lines of Canadian businesses. However, it’s not all doom and gloom. Employers can take proactive steps to help employees reduce their risk of diabetes– even reverse the onset of the disease - and mitigate the rise in drug and disability claim costs. In part two of this blog, we will look at some preventative, wellness and disease management approaches that will help employers promote and protect the health of their employees and their businesses.