EAPs: Cost-effective, and more

It would be worthwhile to establish an Employee Assistance Program (EAP) for the savings alone - between $5 and $16 for every dollar invested, through fewer insurance claims and reduced absenteeism. But of course there are other reasons: employee well-being, reduced distraction, and fewer accidents.

Whats new in employee assistance? Why are so many companies signing on for service? And how are providers evolving to meet changing needs? Those are among questions explored in this White Paper.

A half-century of progress. EAPs first appeared in the 1950s as a way to help employees with drug and alcohol problems. The Employee Assistance Professionals Association, Inc. (EAPA) offers this current definition: "a worksite-based program designed to assist (1) work organizations in addressing productivity issues and (2) employee clients in identifying and resolving personal concerns (including, but not limited to, health, marital, family, financial, alcohol, drug, legal, emotional, stress, or other personal issues) which may affect job performance."

EAP services are diverse and can include:

• Consultation with, and training of, business leaders.
  
  
• Identification and assessment of employee problems.
  
  
• Short-term intervention, motivation, and constructive confrontation to address those problems.
  
  
• Referral of employees for diagnosis, treatment, and assistance, plus case monitoring and follow-up services.
  
  
• Identification of the effects of EAP services on the work organization and individual job performance.
  
  
• Training and education on work/life issues including parenting, elder care, financial and legal issues, etc.

Broadening acceptance. EAPs are growing in acceptance. According to EAPA, approximately 80 percent of Fortune 500 companies have a program in place. A 1999 study by the Society for Human Resources Management found that among businesses with over 5,000 employees, 95 percent had EAPs. That percentage was 81 percent for companies with from 2,500 to 5,000 workers, and went down to 59 percent for businesses with 100 to 250. EAPs are required by law for some types of workers. For example, the U.S. Department of Transportation, Department of Energy, and Nuclear Regulatory Commission have antidrug and fitness-for-duty rules that include EAP requirements applicable to contractors doing business with them. The Drug-Free Workplace Act, which also affects federal contractors, includes a provision advocating EAPs. Many state and local governments have followed the federal governments lead.

Beyond mandates. Businesses establish EAPs for a host of other reasons, including saving money. One of the most frequently quoted studies regarding EAP cost-effectiveness was performed by the McDonnell Douglas Corporation, which saw a five-to-one return on investment, with 85 percent of the cost offset the result of decreased medical claims. The estimate is considered conservative because it represents only the value of days lost by employees who used the EAP. It does not include replacement labor costs, recruiting, and training.

In a survey of 1,500 major U.S. employers, EAPs were cited as one of the top programs and policies that help employees balance work and family responsibilities. Other factors that support EAP use include:

• It has been shown to result in a 33 percent decline in use of sickness benefits, a 65 percent decline in workplace accidents, and a 30 percent drop in workers comp claims.
• Excessive absenteeism costs corporate America around $600 per employee per year.
• Productivity losses due to alcoholism and drug addiction exceed $100 billion annually.
• Employees who abuse drugs incur 300 percent higher medical costs and benefits than healthy co-workers.
• Employer costs for mental health and substance abuse disabilities rose 335 percent between 1989 and 1995, faster than any other category of medical expenses.

Concept goes global. A University of Denver doctoral thesis in the late 1970s has evolved into a global Employee Assistance Program now known as EAP International. According to business development coordinator Laurel Peterson, the organization serves about 200,000 employees, plus their household members, in 22 countries. Even at that, she says, EAP International is considered a mid-sized provider. "Throughout the years, weve been an organization run and managed by clinicians. We try to keep the focus on delivering quality, responsive, personal service."

The companys 24/7 national call centers are staffed by counselors who hold masters degrees in psychology or related fields. A participating employee can call the center toll-free at any time and speak with a counselor. If an employee prefers face-to-face help, the phone counselor helps make appointments with local service providers. "About 96 percent of calls turn into face-to-face sessions," Peterson notes. She explains that client companies can purchase services in different packagesfor example, three, five, or eight one-on-one sessions per issue (problem). Employees are allowed "unlimited issues" per year, which means they can be seen for a marital problem, then return for help with a concern about stress, a parenting issue, etc.

Other service features. EAP International also offers over 100 online training modules for employees and managers. Topics range from how to deal with the holidays to how to run a meeting, communication skills, stress management, parenting, etc. As well, companies can access live management training delivered on-site by EAP International experts. Peterson explains: "We are there to help walk managers through any employee performance issues that come up in the workplace. We serve as a third party, objective resource. Many managers dont want to admit to colleagues that they arent knowledgeable about subjects like sexual harassment, threats of violence, safety, or emotional issues."

She emphasizes that EAP Internationals services are personal and always accessible. That includes emergency situations as well. Counselors can be mobilized quickly to respond to potentially volatile situations, such as those involving accusations of drug use or imminent firing. A manager faced with a distraught employee might get a specialist on the phone to help de-escalate a situation. Businesses can contract with EAP International to provide specialists to participate on safety or threat-of-violence committees.

Overall, marital discord leads more employees to seek EAP International services than any other issue, Peterson observes. "But we also see many other emotional concerns, as well as adjustment (to marriage, birth, death, etc.), alcohol and substance abuse, job stress, family violence, and career decisions." Whatever the issue, Peterson says employees and their employers benefit from the fact that EAP assistance is confidential.

Its an opportunity for employees to "proactively work on issues before it gets to the point where health insurance is involved. Companies not only see their mental health claims go down, but their medical claims as well." Peterson cites the experience of one pharmaceutical company that determined that EAP users incur an average of $2,000 less per year in medical claims than other workers. Depression, one of the leading causes of disability, is a prime example of an emotional problem that can have significant physical repercussions.

The Unocal experience. Like many large energy companies, Unocal Corp. of Sugarland, Texas, has offered EAP services to employees for decades. Rick Wall, manager of work/life services for the oil and gas company, says the first EAP in the 1950s was championed by an executive who was a recovering alcoholic. It focused on dealing with alcohol use, then broadened in the 1960s to include other substances. In the 70s the program extended to mental health issues. Today, work/life issues are the focus of attention, as suggested by Peterson at EAP International. "The demand for these types of services is increasing," Wall states. "As companies can no longer compete on salary alone, they try to position themselves to be an employer of choice based on work conditions, benefits, etc."

EAP use is part of the Unocal culture. One reason the program is so strong, Wall suggests, is that the program is well-accepted and is used at all levels of the company. "Senior managers use it and talk about it." They also talk about the money it saves, he says. In the last two years, Unocal has gone from a co-pay model for EAP use (similar to the way health coverage works) to a per capita, prefunded structure. That means Unocal pays a set fee per employee, which Wall says helps "stem the medical plan drain."

"Its a cost containment tool. Anybody whos self-insured should be able to save $4 in costs for each dollar spent on an EAP." Unocal uses Managed Health Network (MHN) as its EAP provider. Like the structure described by Peterson of EAP International, MHN assistance starts with a call to an 800 number, where professionals provide brief phone assessment. The caller receives the names of three or four specialists close to his or her home or workplace. Five hours of counseling are allowed for each "issue;" the same is allowed for employees family members.

Extending coverage. Wall says Unocal recently completed its first full year with expanded work/life offerings. Data indicated that the new category accounted for a third of all EAP services used, suggesting the considerable burden employees face as they try to balance jobs and family life. The most common concerns for those who seek traditional (clinical) EAP help are relationships, parenting problems, and depression. Wall believes Unocals EAP, which is available to 4,000 U.S. employees, brings professional counseling services to many who might not otherwise have access to them. "When I conduct program orientations in industrial, blue collar environments like Surfside, Texas," he says, "people are astounded to learn that the EAP is free. Many say they hadnt sought out counseling because they could not afford it. Now thats not an excuse."

Under Unocals management referral policy, supervisors can require employees, under certain conditions relating to performance, to seek EAP counseling. It may be discovered that a problem of chronic absenteeism is actually a reflection of an out-of-control home situation. Whatever the issues, management referral frees supervisors from dealing with personal problems and, instead, lets them concentrate on workers job performance. In management referral situations, counselors are restricted in the information they can give supervisors about the sessions. A counselor can only report that an employee called and showed up, and that he or she is or is not following recommendations made by the counselor.

Wall is an enthusiastic advocate of EAPs. Although he says efforts at precise measurement of outcomes are "fledgling," he acknowledges that about 75 percent of problems presented are managed within the five-session limit, and do not turn into medical claims. "Increased productivity is hard to measure, but anecdotally, I could give you hours of testimony. We get a lot of positive feedback."

Room for improvement. Despite the evolutionary expansion of EAPs, reforms are still needed to respond to a changing work environment. Thats the viewpoint of Greg DeLapp, who heads employee assistance for Carpenter Technology Corp., a maker of specialty steel and engineered materials in Reading, Pennsylvania. DeLapp has been active in employee assistance for 25 years and is immediate past president of the EAPA.

Although alcohol and drug issues are not what bring most people to an EAP professional these days, DeLapp believes substance abuse is, in fact, the underlying problem in many cases. "Many EAPs hardly see alcohol problems anymore. But its not because the problems gone away." He blames inadequate training of counselors who are missing or overlooking drugs and alcohol. If employers hire from within their communities, and if substance abuse remains a problem in the community, it will continue to be a problem on the job, says DeLapp.

One challenge is that todays drugs can be harder to detect. In the past, alcohol on a workers breath was a fairly reliable clue. By contrast, says DeLapp, someone with a cocaine problem may be a high-energy performer who gives no clue of a drug problem until the day he or she lands in an emergency room from an overdose. The depression or anxiety that leads them to the EAP might not be the real problem. The fact that todays workers are more mobile is another key difference that must be addressed. DeLapp says employees have less longevity at a job, which makes it harder for supervisors to become familiar with their patterns and behaviors. It also means employees may not be too enthusiastic about dealing with performance issues; they feel that if things dont work out with one employer, they can easily move on to the next job.

Another complication is the fact that work is exceedingly fast-paced today. "Stress levels are higher, and everybody wants everything yesterday," DeLapp adds. He believes the EAP business needs to retool to adjust to these and other changes, including those relating to technology. "I was brought up in an EAP world where you sat across the desk and talked to somebody. Yet there are employees today who are perfectly comfortable with a total e-mail approach, but we havent adjusted." The risk is losing a population in need of services. Its a significant risk, too, considering that, according to one estimate, it is five times more costly to terminate an employee for chemical dependency than to rehabilitate.

Are you doing all you can? If your company already offers employee assistance, it may be timely to take a hard look at your expectations for the program, the service youre getting, and its impact on your employees. Do you have the relationship youd like with your EAP provider? Is the company responsive to your concerns, such as complaints about a particular counselor, or your desire for customized services? Even if you do have reliable means of measuring your programs success, consider conducting informal focus groups with users to learn how employees are using the service, and its effect.

If youre just gearing up, the Internet offers a great many articles and publications on the subject of employee assistance. You may wish to start with your favorite search engine. Also, check out www.eapassn.org, the site of the EAPA.