An Unhealthy America: The Economic Burden of ... - Milken Institute

An Unhealthy AmericaMilken InstituteThe following table illustrates the historical indirect impacts per EPRC and the ECC.Wage-Based Indirect Impacts per EmployeeWage-Based Indirect Impacts US$ Thousands, per Employee 2003 - US$ Thousands, 2003Individual* Expenditures PRC* Expenditures/PRCCaregiver**Disease(Billions) (Millions) (Thousands)Chronic DiseaseCancerLost Workdays48.1Presenteeism10.6Lost Workdays4.5PresenteeismCancerBreast Cancer1.05.517.51.10.64.813.1Asthma Colon Cancer 0.6 3.9 2.2 0.3 0.3 11.51.6DiabetesLung Cancer0.86.36.40.40.417.14.8HypertensionProstate Cancer0.74.33.51.00.54.12.6Heart Disease Other Cancers 1.0 28.0 3.5 7.7 0.7 3.62.6Stroke Pulmonary Conditions 1.5 45.2 6.6 49.2 0.9 0.95.0Emotional Disturbances Diabetes 1.1 27.1 7.9 13.7 0.6 2.05.8Total Hypertension 0.8 32.5 5.2 36.8 0.5 0.93.9* Per EPRCHeart Disease 64.7 19.2 3.4** Per ECCSource: Milken Institute Stroke 13.6 2.4 5.6Mental Disorders 45.8 30.3 1.5Total 277.0 162.2 1.7Stroke has a higher per-EPRC impact than either heart disease or hypertension on lost workdays. Moreover, individualPRC: Population Reporting Conditionpresenteeism for stroke is considerably higher than it is for heart disease and hypertension. However, individualpresenteeism is highest for cancer and emotional disturbances. 75 For caregivers, presenteeism is highest for cancer,followed by emotional disturbances. 76 Much of this presenteeism is attributable to caregiver stress. 77To obtain indirect impacts of different types of cancers, we use the expenditure shares for different types of cancer,shown in an earlier table on “Direct Costs by Chronic Disease, 2003”. For example, we apply the expenditure share oflung cancer 78 to the indirect impacts of all cancers and attribute that as the indirect impact of lung cancer. Of thecancers examined, lung cancer had the highest 2003 wage-based indirect impact, at $15.7 billion, followed by breastcancer ($13.7 billion); prostate cancer ($10.6 billion); and colon cancer ($9.7 billion).Most analyses of the indirect impacts of chronic disease base their estimates on average wages. Wages are the mostaccurate measure for evaluating the value of marginal reduction in lost work hours or productivity. But GDP peremployee is more accurate for evaluating the marginal loss to the firm or to the overall economy. It captures the totalvalue of the forgone output.In the following table, indirect impacts for cancer and diabetes, based on output (GDP), total $271.2 billion and $104.7billion, respectively. The indirect impacts for cancer and diabetes, based on wages, total much less, $120.4 billion and$46.4 billion. Thus, we can see that output-based estimates total more than twice the wage-based estimates. Thispattern is similar to that found in comparisons of average wages and GDP per employee. In 2003, the average wage peremployee was $37,000. GDP per employee totaled $84, 000, 79 again a little more than twice the wages per employee.75. An article published in the Medical News Today reports that the presenteeism for depressed employees is very high(“Depressed Employees Vulnerable to Presenteeism and Absenteeism,” December 12, 2006).76. Indirect impacts are based on NHIS data, which refers to “emotional disturbances.”77. For example, the National Alliance for Caregiving (NAC) and AARP “Caregiving in the U.S.” (2004) reported that acaregiver’s main health problems are emotional.78. Breast cancer accounted for 11 percent of total expenditure on cancer; colon (8 percent), lung cancer (13 percent),and prostate cancer (9 percent). Other types of cancer constituted the rest, 59 percent.79. Sources: Bureau of Labor Statistics and Bureau of Economic Analysis through Economy.com.[ 131 ]