When I look at group health portfolios, the most expensive employee is rarely the person carrying the highest salary, the most visible diagnosis, or the most complex claim. What I see repeatedly is exposure linked to older employees getting absorbed into broad workforce averages, leaving organisations to discover the true cost through absence, delayed treatment, reduced capacity, and avoidable turnover.
That exposure is becoming harder to ignore. In 2025, 9.4 million people aged 50 and over were on UK payrolls, while the average age of exit from the labour market reached 65.8 for men and 64.7 for women, marking the highest recorded levels in the ONS series.
The risk has moved inside the workforce
For decades, workforce health planning treated age as a retirement-adjacent issue. That assumption no longer reflects the labour market. People are working longer, employers are retaining experienced specialists, and many organisations rely on older employees to preserve institutional knowledge during skills shortages.
The 50-plus population is not a marginal segment of the workforce. The employment rate for people aged 50 to 64 was 71.6% in 2025, and 50-plus employees accounted for 9.4 million payrolled workers. These are not employees approaching an inevitable exit; they represent a substantial and strategically important component of organisational capacity.
Yet many group health strategies remain designed around population averages rather than age-linked risk. Employers may track overall absence, private medical insurance utilisation, and employee assistance programme engagement without asking whether their 50-plus cohort generates a distinct pattern of exposure.
That distinction matters because age is not a diagnosis. It acts as a proxy for the rising probability of several interacting risks, including chronic conditions, musculoskeletal problems, cancer, cardiovascular disease, mental ill health, menopause-related symptoms, caring responsibilities, and longer recovery from acute episodes. The commercial issue is not that older workers are inherently less healthy. Rather, a larger proportion of the workforce now operates within a period of life when health risks can become more persistent, more expensive, and more consequential for workforce continuity.
Frequency is not the only problem
The ONS recorded a UK sickness absence rate of 2.0% in 2024, equivalent to an estimated 148.9 million working days lost, with older workers appearing among the groups possessing the highest absence rates. The same release found that musculoskeletal problems accounted for 15.5% of absence occurrences and mental health conditions accounted for 9.8%.
These figures describe absence rather than the full cost of health risk. A group health portfolio can absorb expense without producing a corresponding absence event. An employee may continue working while experiencing pain, fatigue, sleep disruption, or anxiety, but at reduced capacity. That presents as presenteeism, slower decision-making, lower concentration, more errors, or a gradual withdrawal from higher-value work.
The risk is particularly acute in knowledge-intensive organisations. An experienced engineer, adviser, clinician, lawyer, or senior manager may remain technically present while their effective capacity declines. The resulting cost is rarely captured in the medical claims report, appearing instead in project delays, management time, performance concerns, unplanned workload transfers, and the eventual loss of a hard-to-replace employee.
The ONS data also show that long-term health conditions materially affect absence, recording a 2024 sickness absence rate of 4.0% for people with a long-term health condition, compared with 1.0% for those without one. That fourfold difference should change how risk leaders interpret the age profile of their insured population. The question is not simply how many older employees have claimed, but how many are approaching a point where a manageable condition becomes a sustained productivity or retention problem.
The exposure is clinically and commercially interconnected
Age-linked risk rarely arrives as a single, isolated claim. Musculoskeletal pain affects sleep and mobility. Menopause symptoms affect concentration, confidence, and attendance. A cancer diagnosis creates extended treatment and rehabilitation requirements. Cardiovascular risk often coexists with diabetes or obesity, while caring responsibilities compound stress and reduce an employee's ability to engage with treatment.
This explains why conventional product-by-product reporting is often inadequate. Private medical insurance shows treatment authorisations, occupational health shows referrals, absence data shows duration, and employee assistance services show engagement, yet none necessarily explains the relationship between them.
The CIPD Health and wellbeing at work 2025 report found that the average level of employee absence had risen to 9.4 days per employee per year, marking the highest level in more than 15 years. It also identified musculoskeletal issues, anxiety, sleep problems, and depression among the most commonly reported employee health conditions. The report further found that 69% of employers offered occupational health services, rising to 86% among organisations with 250 or more employees, but only 31% used occupational health to manage health risks.
That gap is commercially significant. Many organisations possess the data and services required to identify emerging risk, but fail to connect them into a coherent portfolio view. Consequently, they intervene after absence has become visible rather than when risk is becoming actionable.
A 50-plus workforce therefore becomes under-priced in two ways. First, the employer underestimates its likely health expenditure and absence burden because age-related exposure is diluted within aggregate metrics. Second, the insurer or intermediary often works from incomplete risk intelligence, particularly where claims, workforce demographics, occupational health, and absence information are held in separate systems.
What this means for leadership
For HR, the issue is workforce sustainability. Retaining older employees without adapting work, access to care, and line-manager capability is not a retention strategy; it is a deferred-risk strategy.
For Finance, the relevant cost stretches wider than premium. It includes salary continuation, temporary cover, recruitment, lost output, management time, and the opportunity cost of delayed work. A lower premium does not equal a lower total cost of risk if achieved by narrowing access to early intervention or accepting longer recovery periods.
For Risk Managers, age must be treated as a portfolio variable rather than a demographic footnote. The organisation should understand the concentration of 50-plus employees by business unit, role, location, work pattern, and exposure to physical or psychological demands, while distinguishing between manageable prevalence and deteriorating severity.
The legal and reputational dimensions matter too. A crude older worker intervention would be both commercially and ethically inadequate. Effective risk management should focus on health needs, job design, and access to support while avoiding assumptions about capability based on age. The objective is not to manage older people differently by default, but to identify where work and health risk misalign.
Five actions for the next renewal cycle
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Build an age-segmented risk view by analysing claims, absence, occupational health referrals, long-term conditions, and turnover by age bands rather than using all employees as the primary benchmark. Compare 50-54, 55-59, 60-64, and 65-plus groups where sample sizes permit, reviewing results by business unit and job family to locate concentration rather than calculating a workforce-wide average.
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Replace retrospective reporting with early-warning indicators by tracking repeated short-term absence, delayed treatment, recurring musculoskeletal complaints, reduced working hours, occupational health recommendations, and critical-illness pathways. None is definitive alone, but together they reveal rising severity before a claim becomes materially expensive.
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Fund targeted prevention and fast access to care because generic wellbeing campaigns are unlikely to address highest-cost pathways. Prioritise rapid musculoskeletal assessment, menopause support, cardiovascular risk management, cancer pathways, sleep interventions, and psychologically informed rehabilitation where data show material exposure.
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Equip line managers for capability conversations by providing practical training on adjustments, phased returns, fluctuating conditions, and sensitive health conversations. The CIPD found that only 29% of organisations train line managers in mental health, although 73% of those that do report managers feel confident in having sensitive discussions and signposting support.
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Make the insurer and intermediary accountable for insight at renewal by asking for age-banded claims trends, severity drivers, high-cost pathways, treatment delays, and recommendations linked to the actual workforce profile. A technically polished dashboard that fails to explain where risk accumulates is not portfolio intelligence.
The strategic shift
The 50-plus workforce should not be framed as a cost problem or a homogeneous older worker category, but as a material concentration of experience, capability, and increasingly visible health exposure.
The organisations that manage this well will not wait for age-related risk to appear as a premium shock or a wave of long-term absence. They will connect workforce demographics with claims, absence, occupational health, and productivity data, then invest where earlier action preserves capacity.
Stop asking what your claims cost last year and audit which risks are becoming more probable in the workforce you will still rely on five years from now.