Abstract
BackgroundNational working groups identify the need for return on investment research conducted from the purchaser perspective; however, the field has not developed standardized methods for measuring the basic components of return on investment, including costing out the value of work productivity loss due to illness. Recent literature is divided on whether the most commonly used method underestimates or overestimates this loss. The goal of this manuscript is to characterize between and within variation in the cost of work productivity loss from illness estimated by the most commonly used method and its two refinements.MethodsOne senior health benefit specialist from each of 325 companies employing 100+ workers completed a cross-sectional survey describing their company size, industry and policies/practices regarding work loss which allowed the research team to derive the variables needed to estimate work productivity loss from illness using three methods. Compensation estimates were derived by multiplying lost work hours from presenteeism and absenteeism by wage/fringe. Disruption correction adjusted this estimate to account for co-worker disruption, while friction correction accounted for labor substitution. The analysis compared bootstrapped means and medians between and within these three methods.ResultsThe average company realized an annual $617 (SD = $75) per capita loss from depression by compensation methods and a $649 (SD = $78) loss by disruption correction, compared to a $316 (SD = $58) loss by friction correction (p < .0001). Agreement across estimates was 0.92 (95% CI 0.90, 0.93).ConclusionAlthough the methods identify similar companies with high costs from lost productivity, friction correction reduces the size of compensation estimates of productivity loss by one half. In analyzing the potential consequences of method selection for the dissemination of interventions to employers, intervention developers are encouraged to include friction methods in their estimate of the economic value of interventions designed to improve absenteeism and presenteeism. Business leaders in industries where labor substitution is common are encouraged to seek friction corrected estimates of return on investment. Health policy analysts are encouraged to target the dissemination of productivity enhancing interventions to employers with high losses rather than all employers.Trial registrationClinical trials registration number: NCT01013220.
Highlights
National working groups identify the need for return on investment research conducted from the purchaser perspective; the field has not developed standardized methods for measuring the basic components of return on investment, including costing out the value of work productivity loss due to illness
In between method comparisons, this study found that the $617 per capita productivity loss derived from compensation methods increased 5% with disruption correction and decreased 50% with friction correction
Intervention developers designing programs for employer purchase are encouraged to estimate the value of work productivity improvement from the compensation perspective and its two refinements to generate a range of return on investment estimates
Summary
National working groups identify the need for return on investment research conducted from the purchaser perspective; the field has not developed standardized methods for measuring the basic components of return on investment, including costing out the value of work productivity loss due to illness. Recent literature is divided on whether the most commonly used method underestimates or overestimates this loss The goal of this manuscript is to characterize between and within variation in the cost of work productivity loss from illness estimated by the most commonly used method and its two refinements. The empirical literature remains inconclusive in terms of whether this method under-estimates or over-estimates the productivity losses from the employer perspective. Traditional compensation methods may over-estimate productivity loss by assuming that loss due to illness is not made up by coworkers or contracted labor. Other researchers have recommended applying downward adjustment to the loss estimates by using friction methods [10,11,12]. It remains unclear to what extent illness-related productivity loss estimates utilizing the compensation approach are sensitive to both types of adjustment
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