I think the formula you're thinking about is the Bradford factor. Here is the website link. Big companies HR departments use it to spot problems.
http://www.bradfordfactorcalculator.com/
The College I used to work at used something like this. If you had more than 10 days sick it triggered meetings with HR / manager. It also tracked the pattern of absence e.g. always taking Mondays off etc.
I think most companies use a 'back to work' form now on which you have to say why you were off and it usually involves a formal meeting with your manager. Basically it's used as a deterrent but it also documents the fact that the company is offering help with any health problems (e.g providing a better chair & foot support if you are a computer operator with back ache) - negates a claim against the company in the future too no doubt...!
Ultimately if a member of staff is taking a lot of sick time then you can apply for a medical report from their GP which will state if the employee is fit for work. You will need the person's signature to apply for this. What you will find is that if they give permission they are genuinely ill but if they refuse then you know they are pulling a fast one. 9 times out of ten they will resign following this as they know they have been rumbled.
Holding back pay is your best way forward to start with.
If it continues and is causing loss of income to your business then if you give the person notice (can't remember how long at at the mo) of reducing their hours (due to no client demand) then this will either make them attend work or leave.
I had a very difficult situation years ago with an absence problem - in the end I took it to a solicitor who wrote a letter to the person. She left very soon afterwards.
I feel your pain! best wishes,