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Overtime Primer: Highlights from the New Regulations
The federal DOL overtime regulations go into effect this year. Are you ready?
This report includes a summary of key changes, including the salary level test and salary basis test.
As a bonus, we've included a handy flowchart to help you determine exemption status under the FLSA.
June 20, 2001
Depression Is More Common Than You Think
- One in five employees will suffer from a mental illness this year, with depression being the most common illness.
- Depression primarily hits workers in their most productive years, the 20s through 40s.
- Depression's annual toll on U.S. businesses amounts to about $70 billion in medical expenditures, lost productivity, and other costs.
Few companies know the true cost of depression to their business, says Paul Greenberg, a health-care economist at the Cambridge, Mass., consulting firm Analysis Group/Economics.
That's because the indirect costs, like reduced productivity and such related illnesses as alcoholism, aren't readily apparent. And unlike those with allergies or appendicitis, people with mental or emotional problems tend to hide their conditions - for fear of stigmatizing their careers.
What companies do see, according to the Wall Street Journal, are the ever-rising medical bills for treating psychiatric illnesses of their employees. U.S. antidepressant sales alone have risen more than 800 percent, to $10.2 billion, since 1990, according to IMS Health. Add to that the rising cost of interventions such as hospital stays and psychiatrist visits.
The Journal notes that 70 percent of large employers said they were concerned about rising psychiatric claims in a survey conducted last year by consulting firm Watson Wyatt Worldwide and the Washington Business Group on Health, an employer group.
But most companies respond to that rise by trying to control costs. "Companies view health care, and specifically psychiatric claims, as a cost to be minimized," Greenberg says.
Depression is a tough disease to manage because its symptoms are largely invisible and subjective - even as it affects a person's moods, thoughts, and energy levels, according to the Journal.
Even when businesses do acknowledge and try to manage employee depression, it can be a thorny task. Bank One Corp., a Chicago-based banking and credit-card company, conducted an unusually comprehensive computer analysis of employee health data in the mid-1980s to determine why its health-care costs were skyrocketing.
To its surprise, treating depressive disorders cost the company's self-insured health plan $931,000 in 1991 - nearly as much as the $1.2 million cost to treat heart disease. The actual costs might have been closer, but the plan reimbursed treatments for mental health at a lower rate than other medical claims.
"The prevalence stunned us," Daniel J. Conti, a clinical psychologist and director of the company's employee assistance program, told the Journal.
Even more pronounced was depression's impact on indirect costs, such as productivity losses from absenteeism. Depressed employees stayed out on short-term disability longer than employees with other common illnesses, and they suffered a high relapse rate. Another analysis showed Bank One's employees lost a total of 10,859 workdays over a two-year period because of depressive illnesses.
In contrast, high blood pressure resulted in 947 workdays lost and diabetes, 795 days.
Depression also appeared insensitive to status, striking a cross-section of the company's staff, from clerical workers to executives.
Some reasons could be specific to the company. For instance, two-thirds of Bank One's employees are women. Depression appears to strike women at about twice the rate it hits men, though it could be that women simply seek help more often than men.
The company has also undergone a series of mergers, which can contribute to employee stress, according to studies.
Bank One decided to confront employee depression by teaching managers to recognize the signs of depression using the Depression Awareness, Recognition and Treatment program developed by the National Institutes of Health and the Washington Business Group on Health.
It hired a staff psychologist to evaluate the treatment in each mental-health disability case. It also mobilized its employee assistance program to help with employees' transition back to work.
And it ran employee workshops on depression, stress management and managing relationships.
As it dug deeper, Bank One realized that many employees with mental illnesses weren't getting adequate treatment from the company's self-insured plan or from the several HMOs it offered.
So in its self-insured plan, the company substantially reduced employee out-of-pocket costs for the first 12 therapy visits and stressed early intervention, which helps avoid hospital costs.
Yet less than 30 percent of its employees are in the self-insured plan, and Dr. Conti told the Journal that HMO care is still a disappointment, despite pressure from Bank One.
People treated under HMOs often receive drugs and short-term therapy, and while they return to work much faster, the relapse rate is much higher. The company figures it loses many more employee workdays because of the "revolving door" of employees leaving, then returning, only to leave again, Dr. Conti says.
To view the Wall Street Journal article, visit CareerJournal.com.
you believe depression isn't a factor in your workplace, consider that: