Spending an extra $30 dollars on an employee’s health benefit can yield an employer thousands more in net benefits. This potential benefit can be reaped if an employer, who spends on average $4,400 for an employee’s annual premium, includes a $30 chemical dependency benefit per employee.

Neil Jordan, Ph.D., a health economist who specializes in mental health and substance abuse, and fellow researchers found that employers can break even on $30 per employee so long as the mean annual salary is $36,565. Additionally, increasing return on investment (ROI) is directly related to higher employer utilization rates.

The study, Economic benefit of chemical dependency treatment to employers, appears in the April 2008 issue of Journal of Substance Abuse Treatment. According to the authors, it is the first study that examines the economic value of chemical dependency treatment from the employer’s point of view. It “illustrates the benefits of integrating outcomes assessment into routine clinical care.”

“Here’s the chance [for employers] to see the pay-offs of providing a substance abuse benefit,” said co-author Grant Grissom, PhD, president and CEO of Polaris Health Directions. Polaris Health provided the Substance Abuse Treatment Support System (SATSS) that collects patient data for assessment throughout treatment.

“The snap-shot we provide in the paper nicely represents the working population,” Jordan said, as 85 percent of study participants were employed full-time.

After 30 to 60 days of treatment, the study found a 31 percent drop in the absenteeism rate. The number of days absent per month dropped from 2.4 to 0.81. Employers would recover 19 days annually which can yield up to $5,366 in benefit to their employer. Additionally, productivity loss decreased from 40 percent to 25 percent.

That is not to say, however, there is no economic benefit when it comes to employees who earn less than $36,565.

“It’s harder to make the economic case for workplaces dominated by low-paying salaries,” Jordan said. “But it’s important to keep in mind that there were only certain benefits we could measure. Even at the $36,000 level, there could still be [financial] benefits in reducing overall medical utilization and costs associated with turnover.”

The break-even point for investing in a chemical dependency benefit decreases as utilization increases, according to the study. Grissom said employers and human resource managers should publicize to employees that treatment is available, easy to obtain, and confidential.

Participants of the study were selected from Kaiser Permanente’s Addiction Medicine program at four southern California clinics. At Kaiser, patients have access to both medical and behavioral health care within the same health care system.

The majority of patients reported they were not pressured by a supervisor or manager to seek treatment. Half have never entered substance abuse treatment. Most considered themselves to be in good or very good health.

Patients at the addiction clinics received inpatient detoxification, outpatient detoxification, day treatment, and intensive outpatient services. Most treatments were in group settings and involved integrated mental health services.

The study authors recommend early identification and treatment of addiction problems, “thereby averting costs associated with employee impairment and realizing enhanced [ROI] from the addictions treatment benefit.”

According to a recent Ensuring Solutions to Alcohol Problems’ analysis of occupational and substance abuse survey data, alcohol misuse and dependency problems are highest in the hospitality and construction industries. Although alcohol affects all employers in the United States, problems are severely under-diagnosed and fewer than 10 percent of working people ever receive the treatment they need.

A proven method of identification and treatment is an employer-based screening and brief intervention (SBI) program. For employees with alcohol problems, who may or may not be chemically dependent, SBI can financially benefit employers.

For example, a Virginia-based construction company that implements a workplace SBI program that identifies and provides brief treatment for half of the employees and family members with an alcohol problem would save approximately $2 million in lowered health care costs and improved productivity.

The treatment benefit study and Ensuring Solutions’ screening and brief intervention report combined provide strong evidence to employers about the serious financial benefits of providing substance abuse services and coverage for employees.