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Partnerships

Public Health And Business: A Partnership That Makes Cents

Abstract

 
Historically, public health agencies have had relatively few formal partnerships with private business. However, both groups share an interest in ensuring a healthy population. Businesses have a financial interest in supporting organized public health efforts; in turn, business partnerships can increase the reach and effectiveness of public health. This paper makes the case for the business sector’s participation in the broad public health system and its support of governmental public health agencies. Examples of past and current partnerships exemplify how public health efforts benefit business and suggest opportunities for future collaboration to improve the public’s health.

The importance of this partnership is reflected in a 2003 Institute of Medicine (IOM) report that envisions a "public health system" comprising government public health agencies working as equal partners with many other organizations and segments of society, including business, to create conditions in which people can be healthy.¹ This conceptualization reflects the growing recognition that meaningful improvements in health and reduction in disease burden can be achieved only through multisector actions that address the broad determinants of health, including conditions in the physical, social, and economic environments that powerfully influence health.

This paper makes the case for the business sector’s participation in this broad public health system and its support of governmental public health agencies. Examples of past and current partnerships demonstrate how public health efforts help business and suggest opportunities for future collaboration. We propose strategies for facilitating future public health agency–business partnerships and greater business participation in the overall public health system. Implicit throughout the discussion is that the business sector includes organizations that vary greatly by size, structure, and function and, therefore, in how they could contribute to and benefit from partnerships with public health agencies.

A Rationale For Business–Public Health Partnerships

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The U.S. business community has its largest economic stake ever in promoting and maintaining workforce health. Aggregate U.S. health care spending soared from $73 billion in 1970 to $1.7 trillion in 2003.² Between 1987 and 2000, more than one-quarter of this spending was borne by private business.³ Further, the higher spending, compared with all other trading partners, contributes to the erosion of the preeminent U.S. economic power, which places U.S. businesses at a disadvantage in an increasingly competitive global marketplace.

Another important and often overlooked cost to business is the reduced work-force productivity attributable to illness and disability. This cost rarely appears on the balance sheet but represents a major drain on business. Although this loss is traditionally measured as lost workdays, or absenteeism, an emerging body of research has documented an even greater source of productivity loss: workers with health problems who continue to work but with diminished production, also referred to as "presenteeism." For many health conditions, productivity losses from absenteeism and presenteeism exceed associated employer health benefit costs. For example, a recent study of the Dow Chemical Company’s U.S. workforce found that work impairment associated with chronic health conditions accounted for more than 60 percent of the company’s total costs for these conditions, and for 6.8 percent of the company’s total U.S. labor costs.⁴

Chronic disease costs can be traced back to underlying health risks. For example, physical inactivity, obesity, and overweight among adults in California cost the combined public and private sectors an estimated $10.2 billion for medical care, $338 million for workers’ compensation, and $11.2 billion in lost productivity in 2000.⁵ A 5 percent improvement in physical activity and healthy weight would have brought estimated savings of at least $6 billion over a five-year period.

Business And Public Health: A Reciprocal Partnership

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Business has benefited from many public health activities, as shown by the examples below. In turn, business can contribute greatly to addressing the pressing public health problems for which it bears both direct and indirect costs.

Example: tobacco control. In 1965, a year after the first surgeon general’s report on smoking and health was released, 42 percent of U.S. adults smoked.⁶ Businesses were bearing direct and indirect costs of the myriad health problems associated with smoking but did not know it. Public health epidemiologists described the types and magnitude of tobacco’s human destruction, and public health leaders and other advocates convinced legislators to raise tobacco taxes, make public and commercial spaces smoke-free zones, and implement social marketing programs to discourage tobacco use. These efforts cut the rate of U.S. adult smoking in half, to 21 percent in 2004.⁷ In California, where more vigorous tobacco-control efforts have been implemented, the rate has dropped to 15 percent.

The costs of smoking. Business has benefited from this reduction because workers who smoke have much higher health care costs and are less productive than their nonsmoking counterparts. In a study of the DuPont Company workforce, smokers averaged 30 percent more absences because of illness than nonsmokers did, and the excess cost to the company for lost workdays, health care claims, and other employee benefits averaged $960 per employee per year (in 1990 dollars).⁸

Workplace exposure to tobacco smoke also increases medical costs for non-smoking workers, with cost estimates ranging from several hundred to several thousand dollars per employed smoker per year.⁹ Also, smoking results in more staff turnover and associated increased hiring and training costs, increased facility maintenance costs, and increased health and fire insurance premiums. Although some have pointed out that tobacco use can also reduce employers’ retiree costs because of premature death, fewer employers are subsidizing postretirement medical costs, and most employers that offer pensions are offering fixed-contribution rather than defined-benefit plans, capping their financial exposure.

Businesses’ support of tobacco control. Employers have been an informal partner with public health agencies in tobacco control by supporting policies that prohibit smoking in most business settings, charging higher health premiums for smokers, adding smoking cessation as a health benefit, and, in a few instances, not hiring people who use tobacco products. However, despite progress, tobacco use remains a leading cause of illness and premature death among U.S. workers, and continued aggressive tobacco-control efforts are likely to yield sizable additional cost savings to business.¹⁰

Business leaders can provide critically needed support to public health officials in their advocacy for additional tobacco-control policies, such as policies to restrict smoking in restaurants, bars, other commercial establishments, parks, and other recreational settings. Business can also support public health–advocated policies to further restrict tobacco marketing and can partner in social marketing campaigns and community wide tobacco-cessation initiatives.

Example: obesity epidemic. The successful informal partnerships of business and public health around tobacco use could also be extended to the newest national epidemic: overweight and obesity. The obesity epidemic accounted for 27 percent of the growth in inflation-adjusted health care spending in the United States from 1987 to 2001.¹¹ A recent study of a nationally representative sample of full-time employees ages 18–64 found that 70 percent of males and 53 percent of females were overweight based on self-reports, a likely underestimate.¹² In this study, overweight- and obesity-attributable costs (medical and absenteeism costs) ranged from an average of $175 per year for overweight male employees to $2,485 per year for moderately obese (body mass index of 35.0–39.9) female employees.

Most behavioral approaches and medical treatment of obesity have not demonstrated long-term effectiveness. Although the surgical treatment of severe obesity (gastric bypass surgery) has met with some success, its expense and associated risks highlight the critical need for more prevention-oriented strategies.¹³

Public health response thus far. The response to the epidemic, still in its early stages, has focused on ameliorating the "obesigenic" conditions in the physical and social environments. Physical activity has to a large degree been engineered out of our daily lives through both technological advancements and community design (for example, urban sprawl). Also, the most accessible and often least costly foods are laden with fats and processed sugars. Thus, to prevent the worsening of this ominous trend, public health agencies are increasingly reaching out to city planners, transportation officials, and private developers to encourage community design that supports physical activity and increases access to healthy foods.

Just as sanitation, improved housing, and other environmental changes dramatically reduced infectious disease a century ago, similar efforts around environmental change represent our best hope for reversing the obesity epidemic. The potential of such efforts to reduce the disease burden in both community and workplace settings lies in their focus on populations rather than on individuals. For example, increasing the average levels of physical activity and healthy eating by only 5–10 percent in a population will dramatically reduce future cases of diabetes, heart disease, and many other chronic diseases and their associated health care costs.¹⁴

Potential benefits for business. From a business perspective, even a much smaller reduction in health risk behavior can have a large return on investment in the near term. For example, a recent analysis of Dow’s employee health management and risk reduction program found that over a ten-year period, a mere 0.17 percent per year decrease in the prevalence of each of ten health risks in its workforce would reduce health care costs enough to produce a "break-even" return on investment in the program.¹⁵

What employers can do. Employers have several important roles in a broad public health response to overweight and obesity and their associated health problems. First, they can support worksite health promotion programs targeted to both individual workers and the physical and social environments at work. It is heartening that a growing percentage of businesses are investing in worksite health promotion programs, although they remain less common in small firms (10–499 workers).¹⁶ When well designed, these programs have been shown to reduce health care costs and increase workers’ productivity.¹⁷

Employers can change the work environment by offering healthier foods in cafeterias and vending machines, organizing walking groups, providing discounted memberships to fitness clubs, and establishing other policies that support adoption and maintenance of healthful behavior. They also can partner with local governments to help communities better support physically active lifestyles by encouraging public transportation (which also increases walking), increasing and improving park spaces, supporting communitywide physical activity programs, and advocating for mandatory physical education in all grades for all children. They can support the advocacy efforts of local health departments to improve nutrition, for example, through more rigorous nutrition standards in school food services and business incentives for commercial food establishments to serve healthier fare.

What public health agencies can do. State and local health departments can facilitate business partnerships by reaching out to chambers of commerce and other local and regional business organizations. Federal public health agencies can establish important strategic partnerships with corporate leaders and national business organizations. One important example is the participation of corporate sponsors and business leaders in the federal government’s nationwide campaign to prevent type 2 diabetes, in collaboration with the National Institutes of Health (NIH) and the Centers for Disease Control and Prevention (CDC).¹⁸

Example: workplace injury prevention. Public health–enforced safety requirements in the workplace and for protective equipment for workers have greatly reduced rates of death from work-related injury and lost workdays. Over the past sixty years, work-related unintentional-injury deaths in the United States decreased nearly 90 percent, from 37 per 100,000 workers in 1933 to 4 per 100,000 in 1997.¹⁹ Despite this improvement, work-related injuries remain a major source of morbidity and mortality. Approximately 3.8 million disabling work-related injuries occur each year in the United States.²⁰ In 2003, U.S. employers paid $54.9 billion in workers’ compensation benefits, including $25.6 billion for medical care.²¹

Public health interventions. Federal, state, and some local public health agencies are working to further reduce these injuries, through both regulation and cooperation. The success of mandated worker-safety programs has led many employers to focus on innovative ways to continue reducing workplace injuries and illnesses. For example, Daimler Chrysler Corporation was recently honored by the American College of Occupational and Environmental Medicine for its innovative health and safety programs and reduced rates of work-related injuries.²²

The productivity of the workforce has also been increased by a reduction in injuries outside of work. The reduced financial burden to business is attributable in large part to public health interventions at minimal costs compared with those of medical care and lost productivity because of a preventable injury. For example, during 1995–2000, increased use of seat belts was associated with a 50 percent reduction in lost workdays after motor vehicle accidents.²³ Reductions in childhood injury rates as a result of policies to protect public health have also benefited business by reducing parents’ work absences to tend an injured child.

Example: public health–supported health care services. Another role of public health agencies that benefits the business sector is their oversight, and in some cases direct delivery, of publicly funded health care services to the uninsured and underinsured. Of the forty-six million uninsured Americans in 2004, twenty-seven million were working full or part time.²⁴ In 2005, 37 percent of all employers and 42 percent of the smallest employers surveyed (those with 10–49 employees) did not provide health benefits.²⁵ Many others require such large premium contributions from employees that take-up of the employer-sponsored coverage is severely limited.

For these employers, state or locally supported public health care can reduce absenteeism and disability costs from acute illnesses, injuries, and chronic diseases. A large number of working Americans use this system. For example, a recent survey in Los Angeles County found that among all employed adults ages 18–64 in the county, approximately 600,000 (14 percent) had used the public health care system for medical care in the past year.²⁶

Treatment and preventive services. Public health agencies also provide, directly or through contracts, treatment and prevention services for specific serious health problems, such as abuse of alcohol and illicit drugs. Business benefits include improved productivity associated with reduced absenteeism, disability, and staff turnover, as well as reduced liability in some industries. Even employers providing equivalent coverage may get an indirect financial benefit because effective drug treatment programs cut social costs, which might translate to lower taxes.²⁷

Public health agencies fund and also provide prevention and treatment services for infectious diseases easily transmitted to others, such as tuberculosis, syphilis, and HIV. Prompt identification and treatment of these diseases, and preventive treatment of exposed contacts, reduces or eliminates secondary transmission to workers and their families. The introduction of more-effective medications to treat HIV infection in the mid-1990s permitted many previously disabled workers to return to work. Health departments are an important provider of these services.

Public health agencies play a central role in providing immunization services, supplying vaccines and issuing guidelines for their use by private health care providers, promoting employer-based immunization programs, and monitoring for adverse vaccine-associated events. These efforts have greatly reduced productivity losses attributable to vaccine-preventable infections. For example, influenza caused seventy-five million lost workdays and more than 200 million days of restricted activity among U.S. working adults in 1995.²⁸ Vaccination against influenza can reduce this toll by 60 percent.²⁹ An Eastman Kodak study found that providing free flu vaccine to its employees produced cost savings of $100 per employee vaccinated from reduced medical costs and improved productivity.³⁰ Childhood vaccinations also benefit businesses by reducing parents’ lost workdays to care for sick children and reducing the likelihood that a vaccine-preventable disease will spread from children to their working parents.³¹

What businesses can do. Businesses can improve the public’s health and their own bottom line by covering all recommended clinical preventive services (for example, immunizations and tobacco cessation services) as part of their benefit plans. They can also support public health advocacy efforts to increase health insurance coverage and ensure adequate funding for the health care safety net.

Example: public health emergency preparedness. SARS. Emerging infections are a constant threat to the health of the entire population and to commerce. The experience with severe acute respiratory syndrome (SARS) is illustrative. Starting as atypical pneumonia in southern China in November 2002, it spread quickly among family members and health care workers. Lack of transparency by some Chinese government officials delayed effective monitoring and control efforts by the World Health Organization (WHO). A person unknowingly infected with the SARS virus traveled from China to Toronto on 23 February 2003 and transmitted it to a family member, who was later admitted to a Toronto hospital. The resulting outbreak, with 128 additional cases and 17 deaths, led to widespread panic in Toronto and across Canada and to international travel advisories’ being issued by the WHO and CDC.³² The cost to business in Canada of this limited SARS outbreak was forecast to be $1.5 billion (Canadian) in 2003.³³

Not widely appreciated is that the public health infrastructure and health care resources of Toronto and the surrounding area were taxed to their limits. A slight increase in transmission or prolongation in the chain of transmission could have led to a much wider outbreak and commensurately larger economic impact. In addition, this impact might have been far greater without the organized economic recovery efforts spearheaded by the Toronto business community in close collaboration with Canadian government officials during and after the outbreak.³⁴.

Increasing global population density and more intercontinental travel make an infectious disease anywhere an immediate risk for North America. As highlighted by the SARS experience, the business sector has a vital interest in ensuring an effective public health response. Preventing the spread of an imported infectious disease depends upon state and local health departments’ performing aggressive surveillance, with sophisticated laboratory support for rapid identification. Experienced epidemiologists are needed to determine the source of the infection and define the groups at risk. Public health investigators and public health nurses must find and interview those exposed and implement control measures, such as isolation, quarantine, and provision of appropriate medications or immunizations. Public health communication specialists are required to provide accurate and timely information on health risks and appropriate precautions.

Bioterrorist threats. Since the 9/11 attacks in 2001 and the ensuing anthrax attacks, the need for preparedness for possible bioterrorism has reinforced the importance of an improved public health response. Even the limited anthrax attacks in 2001 led to huge social disruption, adversely affecting many businesses. Rapid recognition of a possible attack and swift actions to identify those at risk and institute controls require a strong public health infrastructure and are essential for protecting businesses, their workers and their families, and their customers.

Pandemic flu. Pandemic influenza is a certainty. The only questions are when and how well prepared we will be. In 2005 the Congressional Budget Office (CBO) projected that a severe flu pandemic could cause a 5 percent reduction in the U.S. gross domestic product (GDP), totaling $675 billion in lost worker productivity and decreased consumer spending.³⁵ Critical public health functions that can minimize the health, social, and economic impacts of a pandemic include stockpiling and distributing antiviral medication, speeding vaccine production and distribution, selectively using isolation and quarantine to slow the spread of infection, and coordinating public health and health care resources to assure prioritization of medical care to those most in need.

In preparing for and responding to a pandemic, the reemergence of SARS, or the spread of a communicable disease through bioterrorism, established partnerships between business and public health could be crucial in reducing the health and economic impacts. These links could also help businesses get expert advice on important related issues such as the risks of travel to areas with avian flu or other infectious disease threats and how to best control spread of infection in the work-place. Public health professionals could also help employers understand the likely medical and psychological impacts of threats such as bioterrorism and pandemic flu and could provide guidance on how businesses and their employees and families can best prepare. For example, the Los Angeles County health department has dedicated staff working with the chamber of commerce and other business groups on preparations for pandemic flu, and business leaders sit on the committee advising the agency on bioterrorism.

Fostering Stronger Partnerships

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How can public health agencies interest business in new and stronger partnerships? They can start by providing public health information of value (such as information on cost-effective health improvement strategies or emergency preparedness measures) to chambers of commerce, trade associations, and businesses that share concerns about important issues, such as the costs of ill health of an aging workforce or the potential disruption of and impact on commerce of a sudden disease outbreak. Larger public health agencies can appoint liaison staff whose sole responsibilities are to cultivate and nurture business partnerships. All agencies can establish business advisory groups to assure that private-sector views and concerns are integrated into agency thinking, planning, and operations.

Public health agencies can define "best practices" for protecting and improving the health of workers and the broader population. They can also provide public recognition to businesses that use these practices—for example, to commercial food establishments that provide nutritious food options or companies that have exemplary worksite health promotion or safety programs. Business leaders can participate in all public health activities that involve community partnerships. These partnerships will be enhanced by more often including business leaders and organizations as a priority target audience for public health agency reports on disease trends and population health and including specific recommendations for both business and for governmental policymakers.

Produce business-relevant analyses. Public health departments should develop business-relevant analysis capacities, such as the emerging health impact assessment methodology, to assess the potential health benefits of proposed business-related policies.³⁶ Such analyses could assist in prioritizing policy development efforts and encourage business leaders to adopt policies that are likely to yield the greatest health benefits.

Create tax incentives. Policymakers should consider creating tax incentives for businesses to invest in public health. This investment could include funding support for public health agency initiatives, collaborative work with public health departments, or other public health partnerships.

Forge partnerships. At the national level, a stronger business–public health partnership could translate into more rapid progress on issues of common concern. Organizations such as the Washington Business Group on Health and Partnership for Prevention have long histories of bringing business leaders and federal policy-makers together to discuss mutual concerns. Together they can develop useful products, such as the prioritization of clinical preventive services that has been developed by the National Commission on Prevention Priorities.³⁷ Together, public health and business can also be more effective advocates for congressional actions such as tax incentives for employer sponsorship of worksite health promotion programs, improved nutritional standards for surplus food distribution to schools, and higher standards for clean air and water. Recognition of the value of strong public health agencies could also translate to business support for a dedicated federal funding source to support essential public health services at the state and local levels.

Historically, business interests have often banded together to defeat efforts to regulate specific products, because of the fear of greater government constraints applied to more industries. Partnership with public health could help elucidate key differences between industries with respect to adverse health impacts and garner more business support for such legislative proposals as increasing the federal excise tax on alcohol products, requiring higher average fuel economy standards and including SUVs and minivans, or requiring that nutritional supplements meet standards of safety and efficacy to be sold in the United States.

Business also can join with public health to advocate for laws and ordinances that create healthier physical and social environments. For example, business support of improved nutrition and required physical education in schools, improved mass transit, or prominent nutritional labeling for fast foods can add weight and urgency to these efforts, to reduce the toll of chronic diseases in workers as well as the rest of the population.

Develop performance measurement. Businesses also can assist public health agencies in developing accountable, transparent performance measurement systems, stressing the importance of quantifiable population health goals and progress toward reaching them. Making a strong business case for improved public health capability provides external validation of the value of public health services and the special skill that business can bring to the public health enterprise.

Editor's Notes

 
Paul Simon is director of the Office of Health Assessment and Epidemiology, Los Angeles County Department of Health Services, and an adjunct associate professor in the Department of Epidemiology, University of California, Los Angeles (UCLA), School of Public Health. Jonathan Fielding (jfielding{at}ladhs.org) is director of public health and health officer in the LA County Department of Health Services, and a professor in the Department of Health Services, UCLA School of Public Health, and in the Department of Pediatrics, UCLA School of Medicine.

The authors thank Margaret Shih and Doreen Keough for their assistance with background research.

NOTES

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