Skip to main content

Behavioral health: The hidden chronic condition costing you millions | BenefitsPro

By March 1, 2021April 22nd, 2024No Comments

Behavioral health: The hidden chronic condition costing you millions | BenefitsPro

By Sage Growth | March 1, 2021

Faced with a sea of promising digital solutions to address health care costs, employers need to keep three key things in mind before they invest.

Read the original from Stephanie Kovalick’s article on BenefitsPRO.

Skyrocketing health care costs are making employers sick. The US spends $3.8 trillion on health care every year; 90% of it is spent on care for chronic conditions. Historically, employers have viewed support for five chronic conditions as table stakes to help mitigate health care costs, promote employee retention and improve overall quality of life. Making inroads here can result in huge financial impact: the CDC estimates that lost productivity due to five primary risk factors—high blood pressure, diabetes, physical inactivity, obesity, and smoking—cost employers more than $36 billion annually.

That number is only expected to grow. The pandemic has all but ensured that behavioral health, oft ignored, will emerge as a sixth vital chronic care condition. Pervasive fear of contracting the virus, unprecedented job losses and general income and food insecurity has exacerbated mental health concerns. Individuals are reporting greater levels of stress, anxiety and depression than ever before. McKinsey estimates that the COVID-19 pandemic could result in a 50% increase in the prevalence of behavioral health issues. So much so that up to one in three Americans could need to seek care in 2021. This is expected to cost employers an additional $100 billion to $140 billion in 2021 alone.

As the list of conditions grows longer and the costs mount higher, the promise of digital looms large. Facing astronomical health care costs—annual health care expenditure is expected to reach $6.2 trillion by 2028, or about 20% of the GDP—and the growing needs of a remote workforce, large, self-insured employers are turning to digital chronic care solutions. In response, these solutions are popping up like daisies. There are smart devices to monitor at-home glucose levels and conduct regular blood pressure readings, apps for self-guided cognitive behavioral therapy, and more.

Facing an ocean of mounting health care costs and a sea of promising digital solutions, large, self-insured employers need to keep three key things in mind before they invest:


Behavioral health can no longer remain out of sight, out of mind. American stress levels are at a boiling point: 67% of Americans say they have experienced increased stress over the course of the pandemic. Individuals are reporting greater levels of stress, anxiety and depression than ever before. Pervasive fear of contracting the virus, coupled with unprecedented job losses and general income and food insecurity has exacerbated mental health concerns. McKinsey estimates that the COVID-19 pandemic could result in a 50% increase in the prevalence of behavioral health issues. So much so that up to one in three Americans could need to seek care in 2021.

The financial impact is real: global economic losses related to mental health disorders between 2011 and 2030 are estimated to total $16.3 trillion, nearly equivalent to those of cardiovascular disease, and higher than other chronic conditions. Furthermore, those experiencing behavioral health issues are likely to need additional care. A recent study shows that individuals with behavioral health conditions spend an average of $6,500 more per year than those without.

Despite the clear imperative, a disconnect remains. When asked which conditions they deem most important, only 33% of executives ranked behavioral health as “very”—it ranked seventh in a list. Comparatively, 61% of those surveyed defined diabetes as their top priority. And yet, financial data reveals mental health conditions are dramatically more costly for employers: a recent IBI study shows that depression costs employers $17 per employee per year in disability wage replacement costs, compared with just $2 for diabetes, the next most costly chronic condition.

According to a recent study by Tufts Medical Center, lost productivity for those with depression—or at risk for depression—costs employers an estimated $109 per employee, compared to $9 per employee with diabetes or at risk for diabetes. The study shows that comorbidities drive up costs further: annual health care costs are $2,000 to $3,000 higher for diabetics with unrecognized and asymptomatic depression than diabetics without depression. Individuals with symptomatic depression see incremental health costs that are $5,000 greater.

In light of the financial and personal impact of behavioral health conditions, employers should look for digital chronic care management solutions that offer screenings or support for the most prevalent diagnoses. Research shows that screenings, tele-therapy, and digital CBT tools can help alleviate symptoms and mitigate end costs. The IBI research suggests that providing care early on can go a long way: the average cost for employees taking leave for a mild form of a chronic condition, like depression, can be up to 52% lower than the average cost for a severe form of that same condition.


While the latest and greatest tools can show great promise, employers should perform due diligence to identify the mature digital solutions, which we believe are most likely to develop into the most robust, engaging and helpful platforms. Yet, with the rapid proliferation of digital tools, it can be difficult to “filter through the noise.” Options abound: One recent analysis estimates the app store hosts over 300,000 health-related tools available for download. Another projects that the market for digital health solutions will balloon to $234.5bn in 2023.

Despite this, focus on a singular solution is still top of mind: 71% of employers ranked having a singular digital health management platform as “very important.” Enterprise level solutions are similarly rife: Each solution promises streamlined personal management and mitigation of these chronic conditions and symptoms—and a corresponding decrease in rising employer health care costs.

Despite their existence, the fragmented landscape of chronic care management poses an issue for employers—too many single disease solutions fail to engage enough employees and make enough of an impact for long term success. A recent study conducted my company revealed that 47% of employers count a lack of employee engagement as their greatest barrier to digital adoption and one study determined that typical engagement rates for a health insurer’s disease management programs averaged only 13%.

Employers should seek seasoned solutions. We predict the next few years will see massive market consolidations, as the mature solutions gobble up additional single focus tools to develop robust management platforms that deliver real ROI. Early adopters will see greater employee engagement and the promise of growth as the market—and chosen platform—continues to mature.


Benjamin Franklin’s famous adage rings true for employers today—investing in the right digital chronic care solution will pay off in spades later on. Early results are promising, and reveal very real health improvements: An average Omada participant loses nearly 5% of his or her body weight, keeps it off, and is less likely to develop diabetes. Digital therapeutic SmartQuit has been shown to be two to three times more effective than unaided smoking cessation.

Ultimately, the true ROI of these solutions are that they are a win-win—improving employee health and well-being directly correlates to benefits to the bottom line. A recent Harvard study determined that a well-designed workplace wellness program garners an average ROI of $2.73 for every dollar spent. An analysis of 10,000 patients suggests Livongo’s diabetes management tool can save $88 of medical spend per person per month.

Emergent technologies can help monitor, treat, and control chronic disease in ways previously unimaginable. Wearables and biometrics can monitor vital signs, blood glucose levels, range of motion and more from the convenience of home; and telemedicine platforms can connect individuals to practitioners at the click of a button. Although they may be costly to implement, immediate ROI should not be a business imperative at this juncture. The long term benefits will be manifold: a long term reduction in costly chronic care treatments, procedures, drugs and therapies will result in more resilient, loyal and healthy employees.

While it is all too easy to get bogged down in numbers—like the statistics reporting a bleak American health trajectory and the mounting costs of health care—digital management tools offer a very real opportunity to make a change for your employees. Now is the time to step in and offer a comprehensive, engaging, and rewarding digital chronic care management platform. Empower your employees of all ages, genders and races to make strides towards a healthier, happier future.

While the wild world of health care is more unpredictable now than ever before, digital health management tools offer great promise to large, self-insured employers. These tools promise to help yield healthier employees, lower costs, greater retention and increased resilience, a few main ingredients of organizational success. While options are manifold, employers that embrace three key things—the behavioral health imperative, vetting platforms to seek out a robust “single platform” solution, and leaning in to long term financial and employee health—will be well-positioned to weather the storm of rising costs and health care needs.


Leave a Reply