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The ties between financial, mental and physical health – and what it means for employers

Most would classify insurance as a financial industry. And, they wouldn’t be wrong. At its core, insurance is a financial transaction where people and organizations pay for financial protection from the unexpected. Looking at it that way, however, is also a bit of a simplistic approach. Especially when it comes to employee benefits, brokers and employers need to look closely at the ways that financial, mental and physical health are all interconnected and how all of these impact the workplace.

How financial and physical health are connected

It can be very hard, and in some cases, impossible, to maintain your physical health when you can’t afford to pay for the healthcare that you need. Over half of Americans (54 percent) say they’ve delayed medical care for themselves in the last year because they couldn’t afford it. On top of that, nearly a quarter of Americans have delayed medical care for over a year due to financial issues.1 By foregoing treatment, physical health issues may go untreated, they may last longer and they can even worsen. 

Going back the other way, the costs of treatment and the impact that they can have on an individual’s finances are well-documented. Among people with health insurance, one in five (20%) working-age Americans report having problems paying medical bills in the past year.2

What it means for an employer: More health issues can translate into more work days missed, reduced productivity at the office or, eventually, an extended leave of absence if a condition worsens.

How financial and mental health are connected

Nearly three-quarters of adults report feeling stressed about money at least some of the time.3 And, iIt’s easy to understand why. Employees depend on money to provide for their families, to maintain their homes and their lifestyles and, as we’ve noted, many are so tight on money that they are foregoing medical treatments to try and maintain their finances. Whatever, their circumstances may be, deteriorating financial health can will impact their mental health.

Missing work because you’re stressed, or being distracted at work by finances, ultimately affects an employee’s attendance and performance. When those two dip, their income (especially if they’re paid hourly) will take a dip as well, negatively impacting their financial health.

What it means for an employer: It’s estimated that workplace stress costs employers $500 billion  annually in the form of decreased performance at work or absenteeism.4

How physical and mental health are connected

Physical and mental health are inextricably connected;, poor mental health is a risk factor for chronic physical conditions and chronic physical conditions are a risk for developing poor mental health.

On the positive side, improved physical health can have all kinds of helpful impacts on mental health. Whether it’s higher self-esteem, more energy or a more positive outlook, being physically healthy generally makes people happier. In turn, these positive mental traits help promote more healthy physical behaviors and conditions.

What it means for an employer: Among the conditions that contribute the highest costs to an employer’s healthcare spend are smoking, depression, obesity and heart disease.5 All of these pose a cost risk to employers that can be addressed with promotion of better mental and physical health.

It can be a vicious cycle for employees at times. If an employee doesn’t have financial support to pay for healthcare, their health will worsen;, when their health worsens, it worsens the impact on their finances and can hurt their mental health. Brokers and employers need to work together to provide solutions that assure ensure they’re addressing all aspects of employee well-being. Quality insurance products are a start, but a comprehensive approach is what truly leads to happy, healthy, productive employees.

1”How financial health is affecting Americans’ physical health”. BenefitsPRO. October 2018.
2“The Burden of Medical Debt: Results from the Kaiser Family Foundation/New York Times Medical Bills Survey”. Kaiser Family Foundation. 2016.
3“Stress in America: Paying with Our Health”. American Psychological Association. 2015.
4“Workplace stress costing employers $500 billion annually”. BenefitsPRO. October 20, 2017.
5“Top 10 health conditions costing employers the most”. Employer Benefit News. 2018.

Posted on November 01, 2018 in Industry Wellness

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