State of Addiction: Substance abuse costs U.S. employers hundreds of billions in health care, productivity losses

Drug testing and Employee Assistance Programs are two ways employers help their workers cope with the devastating issue. Oklahoma City-based Chesapeake Energy Corp. implemented a companywide program called “Your Life Matters” to help its employees cope with drug and alcohol abuse.
by Jennifer Palmer Published: March 13, 2012
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The numbers are staggering: Drug abuse is estimated to cost U.S. employers $276 billion a year, and three-fourths, or 76 percent, of people with a drug or alcohol problem are employed.


Employees coping with drug and alcohol abuse are less productive and more likely to waste time at work by taking long lunch breaks, leaving early or sleeping on the job. They have increased health care expenses — costing their employers twice as much as other employees, according to the Substance Abuse and Mental Health Services Administration. And they are three and a half times more likely to be involved in a workplace accident.

But replacing a worker costs 25 percent to 200 percent of their annual compensation, not to mention the loss of institutional knowledge, service continuity and co-worker productivity and morale that often coincides with employee turnover, the administration said.

Drug testing and implementing a company Employee Assistance Program (known as EAPs) are two ways employers control costs related to substance abuse.

Amendments to the Oklahoma Workplace Drug and Alcohol Testing Act aim to give employers more latitude in drug testing employees and reduce their cost of unemployment insurance by denying claims to former workers who were let go for failing a drug test.

The legislation took effect in November. Former state Rep. Dan Sullivan, one of the bill's authors, said the idea was to streamline the drug testing process for employers and make it easier to manage.

“We wanted to make sure we protected employees ... but also make it simpler for employers to implement,” he said.

Previously, employers could subject an individual worker to drug testing if the employer had reasonable suspicion. The amendments implemented “for cause” testing, expanding the circumstances leading to a drug test, including negative performance patterns and excessive or unexplained absenteeism or tardiness.

Sen. Patrick Anderson, R-Enid, who co-authored the bill, said drug testing employees is a “huge safety issue.”

According to a 2009 report by the National Business Group on Health, up to 40 percent of industrial fatalities and 47 percent of industrial injuries are linked to alcohol use, and employees who use drugs are five times more likely to file a workers' compensation claim than workers who don't.

Assistance programs

At the beginning of 2010, Oklahoma City-based Chesapeake Energy Corp. implemented a companywide program called “Your Life Matters” to help its employees cope with drug and alcohol abuse. The company had a medical plan but decided it could do a better job providing resources and removing the stigma of mental health.


by Jennifer Palmer
Investigative Reporter
Jennifer Palmer joined The Oklahoman staff in 2008 and, after five years on the business desk, is now digging deeper through investigative work. She's been recognized with awards in public service reporting and personal column writing. Prior to...
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