Job-Related Injuries and Illnesses Cost $250 Billion

Everyday, people get sick or hurt on the job. The costs of these incidents add up quickly.

In fact, policymakers looking for ways to cut the nation's health care costs might first try to make the workplace a bit safer. In the first comprehensive review of its kind since 1992, a University of California Davis researcher has estimated the national annual price tag of occupational injuries and illnesses at $250 billion.

That figure is $31 billion more than the direct and indirect costs of all cancer, $76 billion more than diabetes and $187 billion more than strokes.

The study strongly suggests that the U.S. should place greater emphasis on reducing work-related injury and illnesses, especially since the costs have risen by more than $33 billion (inflation adjusted) since the 1992 analysis, the author said.

Lack of attention

"It's unfortunate that occupational health doesn't get the attention it deserves," said J. Paul Leigh, professor of public health sciences at UC Davis and author of the study. "The costs are enormous and continue to grow. And the potential for health risks are high, given that most people between the ages 22 to 65 spend 40 percent of their waking hours at work."

The U.S. government, which regulates workplace safety through the Occupational Safety and Health Administration (OSHA) is well aware of the problem.

"A March 2010 Liberty Mutual Insurance company report showed that the most disabling injuries, those involving six or more days away from work, cost American employers more than $53 billion a year – over $1 billion a week - in workers' compensation costs alone, said OSHA Assistant Secretary David Michaels.

For his study, Leigh evaluated more than 40 datasets from sources that track work-related injuries and illnesses as well as their direct medical and indirect productivity costs.

Jigsaw puzzle

"It's an incredible jigsaw puzzle, but an essential one to assemble, since it's impossible for business and policy leaders to effectively manage health-care resources or make changes for the better without first having an accurate assessment of costs," said Leigh.

The study estimated that there were 8,564,600 fatal and non-fatal work-related injuries, which cost $192 billion and 516,100 fatal and non-fatal work-related illnesses, which cost $58 billion.

The study also estimated 59,102 combined deaths from occupational injuries and diseases, which was higher than all deaths from motor vehicle crashes, breast cancer or prostate cancer in the same year.

Leigh noted in the study that workers' compensation premiums do not currently account for these high figures. In fact, he said less than 25 percent of the costs of workplace injuries and illnesses are covered by workers' compensation. As a result, many occupational health issues go unresolved, and the bulk of the costs are absorbed by employer-provided medical insurance, Medicare and Medicaid, raising health-care costs for everyone.