Returns on Investments in Health

J. Michael McGinnis, MD

The Robert Wood Johnson Foundation

12 questions• What kills?• What cripples?• How much does it cost?• What counts?• What’s the big picture?• How do we invest?• What’s effective?• How effective?• What’s cost effective?• How do Rx and Px compare?• What are our prevention priorities?• What else matters?

What kills?

1)

2)

3)

4)

5)

6)

7)

8)

• Heart disease 710,760• Malignant neoplasms 553,091• Cerebrovascular diseases 167,661• Chronic lower respiratory disease 122,009• Unintentional injury 97,900• Diabetes mellitus 69,301• Influenza and Pneumonia 65,313• Alzheimer’s disease 49,558• Nephritis 37,251• Septicemia 31,224

Leading Causes of Death in U.S., 2000

What cripples?

Leading Causes of Disability Among U.S. Adults, 1999

2.8%

3.3%

3.4%

3.7%

4.2%

4.4%

4.7%

7.8%

16.5%

17.5%

0% 5% 10% 15% 20%

Stroke

Blindness/vision problem

Diabetes

Mental/emotional problem

Limb/extremity weakness

Deafness/hearing problem

Respiratory trouble

Heart trouble

Back/spine problem

Arthritis/rheumatism

Percent of 41.2 million persons with a disability

How much does it cost?

$4,637$4,377$4,177

$4,001$3,698

$2,738

$1,067

$348

$0

$1,000

$2,000

$3,000

$4,000

$5,000

1970 1980 1990 1995 1997 1998 1999 2000

National Health Expenditures, Per capita

What we spent in 1997

Rank

12346810121416182022242628

$PP

D p

er c

apita

0

1000

2000

3000

4000

5000

United States

SwitzerlandGermanyLuxembourg

CanadaFranceDenmarkNorwayIcelandNetherlandsAustraliaAustria

BelgiumSwedenJapanItalyFinland

United KingNew ZealandIrelandGreeceSpainPortugalCzechoslovaKorea

HungaryPoland

Turkey

(4,095)

(2,611)

Male life expectancy 1996

1. Japan 77.0 15. Austria 73.7

2. Sweden 76.5 16. Germany 73.6

3. Iceland 76.2 17. Belgium 73.5

4. Switzerland 75.7 18. Ireland 73.2

5. Canada 75.7 19. Luxembourg 73.0

6. Norway 75.4 20. Finland 73.0

7. Australia 75.2 21. Denmark 72.9

8. Greece 75.1 22. United States 72.7

9. Italy 74.9 23. Portugal 71.2

10. Netherlands 74.7 24. Czechoslovakia 70.4

11. Spain 74.5 25. Mexico 70.1

12. New Zealand 74.3 26. Poland 67.8

13. United Kingdom 74.3 27. Hungary 66.6

14. France 74.2 28. Turkey 65.9

What counts?

Actual Causes Of Death, 1990

• Tobacco 400,000

• Diet/activity patterns 300,000

• Alcohol 100,000

• Microbial agents 90,000• Toxic agents

60,000• Firearms

35,000• Sexual behavior 30,000• Motor vehicles

25,000• Illicit Drug use

20,000

What counts?

• Diet/inactivity patterns 500,000• Tobacco 400,000• Alcohol 80,000• Microbial agents 60,000• Toxic agents 60,000• Sexual behavior 40,000• Firearms 35,000• Motor vehicles 25,000• Illicit Drug use 25,000

Actual Causes Of Death, 2000

What’s the big picture?

Genetics30%

Environment5%

Social 15%

Behavior

40%

Health care

10%

How do we invest?

Medical Treatment

Health Expenditures Premature Mortality

Behavioral

Genetic

Health Care

Environmental

Social

Population-wide effort

What’s effective?

Immunization and chemoprophylaxis • e.g. vaccines (childhood, influenza, pneumococcal),

folic acid, aspirin, ocular

Screening and early intervention • e.g. newborn, colonoscopy, mammography, blood

pressure, cholesterol, chlamydia, vision, hearing

Counseling • e.g. tobacco, alcohol, physical activity, diet, infant

feeding, child safety, STD risk

How effective?

What’s cost-effective?

Costs of prevention—examples

Median $/QALY

Immunizations $ 1,500Chemoprophylaxis $ 13,000CVD screening $ 3,300Cancer screening $ 18,500HIV counseling $ 1,200CVD counseling $ 74,000Blood donor screening $ 355,000Autologous blood donation $ 730,000

Source: Stone, et al, AJPM 2000: 19(1)

Score QALYs saved 5 325,000 to 2,600,000 4 65,000 to 185,000 3 33,000 to 55,000 2 19,000 to 27,000 1 100 to 12,000

Ranking: clinically preventable burden

Score Cost ($)/QALY saved 5 Most likely cost saving 4 May be cost saving to 12,000 3 12,000 to 18,000 2 19,000 to 35,000 1 43,000 to 2,000,000

Ranking: cost effectiveness

What are the prevention priorities?

Service CPB CE TotalChildhood vaccination 5 5 10Adult tobacco cessation 5 4 9Vision screen >65 4 5 9Cervical cancer screen >18 5 3 8Hypertension screen 5 3 8Adult cholesterol screen 5 2 7Breast cancer screen 4 2 6Child safety counsel 0-4 1 4 5Folic acid counsel 1 3 4Rubella screening 1 1 2

Source: Coffield et al, AJPM

What are the prevention priorities?

Costs of treatment—examples

Median $/QALY

Atrial fib (anticoag with 1 RF) $ 8,000Atrial fib (anticoag with 0 RF) $ 370,000Diabetes (intensive glycemic control) $ 41,000Hepatitis C (pegylated interferon) $ 46,000Sepsis (Rx APACHE >25) $ 24,000Sepsis (Rx APACHE <24) $ 575,000HIV (3 drug antiretroviral) $ 23,000Emphysema (lung reduction surgery) $ 190,000Lung cancer (CT screening) $ 48,000

Lessons

…….we pay going in…

…….we pay coming out…

…the returns to prevention: Priceless!!

What else matters?

not just clinical assessments…

• cost benefit analysis

• cost effectiveness analysis

• ranking schemes

but public policy…

• health impact assessments

Sample HIA (local)City of Los Angeles Living Wage

• Employees working on city contracts must be– paid at least $7.99/hour– provided health insurance, or an additional $1.25/hour

• Covers approximately 10,000 workers

• Health insurance coverage more cost-effective in reducing excess mortality than an equivalent amount in the form of wages

• Any changes to the ordinance should consider increasing health insurance coverage

• Applicability: many living wage ordinances throughout the US

Source: Fielding et al, 2003

Sample HIA (state)After-school program funding

• California ballot Proposition 49 to set aside $550 million per year for after-school programs in grades K - 8

• Potentially significant health outcomes through effects on education, crime, substance abuse, etc.

• Counterintuitive result: unlikely to yield any significant health benefits. Chiefly due to:

– small magnitude of effects on key mediators

– Inadequate targeting, recruitment and retention of high-risk youth

Source: Fielding et al, 2003

Keep the big picture in mind

Genetics30%

Environment5%

Social 15%

Behavior

40%

Health care

10%