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Indiana Tobacco Quitline 1-800-QUIT-NOW

Quitline > Costs of Employee Tobacco Use Costs of Employee Tobacco Use

Direct and indirect financial costs

No one would argue that employers pay a high price for employees who smoke; but just how much money does smoking cost employers? Smokers cost U.S. employers more annually via lost production, secondhand smoke exposure, workers compensation and medical expenses than nonsmokers.

Employees that smoke contribute to:

  • Higher life insurance premiums
  • Increased absenteeism
  • More time spent on smoking rituals
  • Greater risk of occupational injuries
  • More disability claims
  • Increased cleaning and maintenance
  • More disciplinary actions

The CDC estimates that the economic costs of smoking are $3,391 per smoker per year in direct medical costs and lost productivity. The estimated breakdown is like this: $1,623 in excess medical expenditures, plus $1,760 in lost productivity per year, plus $8 in smoking-attributable neonatal expenditures.

To calculate the specific smoking costs use this formula:

Number of Employees: ______
x Smoking Prevalence 0.23
x Annual Additional Costs $3,391
total = $_____

This represents the cost per year in excess medical expenditures and lost productivity.

(500 employees) x (0.23) = 115 employees who use tobacco (115) x ($3,391) = $389,965 per year in business borne costs associated with smoking.

That's money up in smoke. It is easy to see why the health and wellbeing of employees is a major factor in controlling health care costs.

Smoking impacts your workers' productivity. Non-smokers harmed by secondhand smoke at work have won lawsuits and disability claims against their employers under a variety of legal remedies. The American Productivity Audit, a national survey of over 29,000 workers, found that tobacco use was a leading cause of worker lost production time, greater than alcohol abuse or family emergencies. Smoking impacts your workers' productivity. One large company found that their employees who smoked had more hospital admissions (124 vs. 76 admissions per 1,000 workers) and a higher average insured payment for health care ($1,145 vs. $762) than their non-smoking employees in an eleven-month period.

The impact of secondhand smoke on employees

Think of a lit cigarette as a miniature toxic waste dump. Secondhand smoke contains more than 50 cancer-causing chemicals. The toxins in secondhand smoke can cause heart disease and lung cancer in non-smokers. Breathing secondhand smoke for even a short time could have immediate effects on your blood and blood vessels, aggravating existing heath conditions in non-smokers.

Making the business case for smoking cessation

This tool uses your data and default information to estimate the return on investmentpotential cost savings to you as an employer for to coverage, promotion, and encouragement of smoking cessation. Depending on the amount of data you provide, results can be calculated in 2-12 minutes.

Become a preferred employer to learn more about how you can potentially lower your health care costs by reducing employee tobacco use.