Back to blog

New Calculator Helps Employers Quantify Cost of Untreated Mental Health Issues

healthcare costsmental healthTelehealthemployersdepressionbehavioral healthcalculatorMeMD NewsIndustry News • 3 min read • Apr 18, 2019 12:00:00 AM • Written by: Elie Goodman

It’s a well-established fact that employees’ mental health has a direct effect on profitability, from lost productivity and presenteeism to missed workdays and increased medical expenses. On a national level, the Center for Prevention and Health Services estimates that mental illness and substance abuse issues cost employers between $79 and $105 billion each year.

The impact of untreated mental health concerns on a macro scale is staggering, but the effects on individual companies are considerable, too. Most business owners know first-hand that employees suffering from behavioral and emotional challenges simply do not perform their best at work. They’re often distracted, down, unmotivated, and have difficulty meeting the demands of their job. But how much does this impact a company’s bottom line, and what can employers do about it?

A new online calculator from MeMD gives business owners an idea of the cost of mental health issues – at the micro level – along with a solution for improving employees’ mental and emotional health.


Quantifying the Impact of Mental Health Issues in the Workplace

While dozens of studies estimate the cost of mental illness, a report from the Center for Workplace Mental Health puts the issue into stark perspective. According to their data, presenteeism among employees with depression equates to 32 lost workdays a year – or more than 12% of an employee’s time. For a company with 100 employees and an average employee salary of $50,000 a year ($24/hour), lost productivity due to depression could be costing the business nearly $60,000 annually.

MeMD has designed a calculator that factors in presenteeism and numerous other variables to determine the cost of depression on an individual business.


Behind the Math

The calculator was designed to give employers a glimpse into the bottom-line impact of depression, one of the most common (and most commonly studied) mental health issues.

  • The equation, based on an average 40-hour work week and 30% employee labor burden, assumes a 7% rate of depression (based on research from Workplace Mental Health) and presenteeism totaling 32 lost workdays (from the Center for Workplace Mental Health).
  • In addition to calculating lost productivity, the tool takes into account the work that other employees must absorb when a depressed coworker is unable to fulfill all of his/her responsibilities.

Employers simply plug in basic details about the company – the number of employees and average salary – and the calculator estimates the cost of depression per employee, per month, along with an annual, company-wide cost. Though numerous variables influence the true cost of depression in any given company, this tool gives employers a sense of how poor mental health can impact their profitability. In high-risk industries, such as law enforcement, fire and construction, the costs can be much higher.

Learn more about the math.


The Telebehavioral Health Solution

The calculator also quantifies the effect of telebehavioral health in addressing depression in the workplace. This calculation is based on a Harvard study indicating that workers who received telephone intervention for depression gained back 2.6 hours a week – or 135.2 hours a year – in lost productivity. Said another way, when employers offer and promote behavioral healthcare, they can cut the costs of lost productivity in half.

It’s a lot of math, but the bottom line is this: Businesses that help employees access the care they need can improve company performance, safeguard the bottom line now and in the future, and improve employees’ health and wellbeing.

MeMD’s telebehavioral health providers can help employees overcome mental health concerns including depression, anxiety, family problems, drug and alcohol use, and interpersonal issues.

For more information about the efficacy of telebehavioral health and its importance in benefits packages, download this whitepaper.

Reach the World. Giving Made Easy with Impact.

Elie Goodman