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:
In short, the growing prevalence of diabetes in the workplace is taking a huge toll on everyone.
So what is fueling this epidemic?
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.
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.
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.
Anne-Marie Smith is the Practice Lead for the Drug Plan Solutions team at Medavie Blue Cross. As a Pharmacist Consultant, she collaborates directly with clients and their benefits consultants on drug plan analysis and trends as well as identifying unique opportunities to better manage drug plans and optimize plan member...