Unbiased Analysis of Today's Healthcare Issues

Prevention and Cost

Written By: Jason Shafrin - Mar• 23•09

More evidence that although preventive may improve patient health, it may also increase costs.  (See also my post from 12 Feb 2008).

  • Afschin Gandjour (2009) “Aging diseases – do they prevent preventive health care from saving costs?”  Health Economics, v18(3): 355-362.

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2 Comments

  1. Merrill says:

    I was sorry to see you add your voice to the cacophony that misunderstands the prevention debate. A few points:

    1. The question for economists shouldn’t be whether prevention saves money. It should be whether it is a less costly alternative compared to failing to prevent disease and then treating it. Unfortunately, the CBO adopted the former accounting principle and has dismissed prevention as a strategy to save money. Proper comparative effectiveness analysis, I believe, would show that prevention as a substitute for disease treatment would save the health care system money compared to present projections.

    2. Anything that increases longevity (including treatments) increases overall health care costs under the assumptions of this and other like studies. So why pick on just prevention?

    3. These studies almost uniformly fail to take into account reduced morbidity throughout the increased longevity period, which if properly adjusted, would benefit prevention strategies over treatment strategies.

  2. Jason Shafrin says:

    Merrill, I completely agree with your points. An increase in preventive care or better medical care often increases costs but decreases mortality or morbidity. If we were to value decreases in mortality or morbidity accurately, it is likely that much of preventive care is very cost effective. HOWEVER, politicians who claim that by increasing preventive care will reduce government health care outlays are in general not telling the truth. If I found a drug that cost $20/year but could extend your life by 1 year, this is a very cost effective drug. However, it will also increase medical expenditures by $20 per year. This is of course a good investment, but we still must take into account the extra $20 into the budget. Saying that the $20 pill will save money is incorrect; it will increase costs. Determining whether or not these cost increases are worthwhile is a much more difficult and much more important question.

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