Economic costs of fetal alcohol spectrum disorders
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Economic Costs of Fetal Alcohol Spectrum Disorders. by Henrick Harwood. FASD Field Trainers Meeting Orlando, Florida December 2, 2005. Overview. FAS costs US $4.6 billion in 2004 About $17 per capita; $17,000 per FAS

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Economic Costs of Fetal Alcohol Spectrum Disorders

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Economic Costs of Fetal Alcohol Spectrum Disorders

byHenrick Harwood

FASD Field Trainers Meeting

Orlando, FloridaDecember 2, 2005


Overview

  • FAS costs US $4.6 billion in 2004

    • About $17 per capita; $17,000 per FAS

  • US has up to 41,000 alcohol impacted (FASD) births/yr. or about 4,100 FAS births

  • An FAS birth carries lifetime health/special ed costs of $753,000 ($258,000 today) although can be as high as $3.7 million ($1.4 million)

  • Including quality of life, FAS prevention may be “cost effective” at up to $516,000 per child

  • FAS is among the most costly birth defects

  • State FAS cost estimates are presented


Economic Costs of Alcohol Abuse1

  • $184.6 B in 1998; $670 per capita; 2.1% of GDP

  • Medical consequences of FAS$2.9

  • Lost earnings due to FAS$1.2

  • Specialty alcohol services$7.5

  • Medical consequences, other$16.0

  • Lost earnings, mortality$36.5

  • Lost earnings, morbidity$86.4

  • Lost earnings, crime/victims$10.1

  • Crashes, fires, justice$24.1

1 Source: Harwood, H. Updating Estimates of the Economic Costs of Alcohol Abuse in the United States: Estimates, Update Methods,and Data. Report prepared by The Lewin Group for the National Institute on Alcohol Abuse and Alcoholism, 2000. Available at http://www.niaaa.nih.gov.


This Effort

  • Develop new estimates for FASD

  • Update prior estimates by The Lewin Group (1998)

    • Cost to the US of FAS in a year

  • Review of literature by C. Lupton of NGIT

  • Update and extend analyses published in 1986

    • Cost of a “child born with FAS”

  • Address cost effectiveness, quality adjusted life years and willingness to pay


General Findings from the Literature

  • The majority of the literature focuses solely on FAS

  • Literature related to FAE is limited

    • ARBD and ARND are rarely mentioned

  • Cost estimates for treatment services related to FAS vary considerably


Different Types of Economic Studies

  • Cost of illness

  • Cost effectiveness

  • Cost benefits


Concepts Behind Cost of Illness

  • Assess overall burden on the economy in use and loss of resources per year

  • Consequences (epidemiology)

    • Primary and comorbid health, social/justice system

  • Causality (epidemiology)

    • Attribution factors

  • Costs (economics)

    • Approach to valuation, discounting


COI Often Called “Gee Whiz” Numbers

  • More readily grasped than a large variety of diverse impact estimates: a single number

  • These numbers can be “large”

    • Attention commanding

    • Can be compared to other budgets and problems

  • Suggest something SHOULD be done

  • Do not tell us WHAT should be done

    • Prevention versus treatment or other strategies


Components of Economic Costs

  • Direct Costs (actual use of goods and services)

    • Health system (physical and mental)

    • Educational, social, justice systems (not transfers)

  • Indirect Costs (foregone potential productivity)

    • Mortality

    • Morbidity/disability

    • Incarceration/crime career

  • Intangible Costs

    • Loss of quality of life, experience of pain and suffering

    • Not generally included in cost of illness estimates


Prevalence of FASD

  • “At risk” drinking women 18-44 years (past month) (CDC’s BRFSS)

    • Binge (5+ drinks/occasion): 13.4%

    • Heavy (more than 1 drink/day): 5.8%

    • Binge or heavy: 14.9%

  • FAS prevalence range:

    • 0.5 to 2.0 cases per 1,000 live births

  • FAE believed much more prevalent than FAS

    • up to 10 in 1,000 live births for FAS and FAE


FAE

FAS

Lifetime Prevalence of Secondary Disabilities for FAS versus FAE

96%

92%

68%

51%

67%

51%

55%

44%

54%

44%

41%

28%

Streissguth et al. 1996


Valuation of Indirect Disease Burden

  • Deaths

  • Morbidity: sickness; lost days; impaired days

  • Human capital

    • Current market value of productivity

    • Present discounted value lost future productivity

  • Willingness to pay (up to $6 million/life)

  • Quality adjusted life years (QALY) ($50-100,000)

  • Disability adjusted life years (DALY)

  • Years of potential life lost (YPLL)


Economic Cost of FAS in U.S., in 2004

  • National

    • Direct: $2.66 billion

    • Indirect: $1.90 billion

    • Total: $4.56 billion


Major Direct Cost Components


Major Direct Cost Components (cont.)


Worst Case

Expected Case

Direct Costs per Year, per FAS Case

Health Cost/Year

Age


Lifetime Direct Costs of a Person with FAS

  • Direct costs

    • Average $753,000

    • Maximum $3.7 million

  • Discounted Lifetime (3%)

    • Average: $258,000

    • Maximum: $1.3 million


Indirect Costs of FAS

  • Value of lost potential productivity

  • Human capital approach (PHS Guidelines)

  • Age/gender adjusted valuation: over $60,000/yr

  • In 2003 expected > $2.5 million at birth

    • Discounted $1.1 million

  • Mental disability/retardation due to FAS related to 20.5% reduction

  • $218,500 lifetime discounted loss per child


Indirect Costs of FAS

  • Due to mental disability

  • 294,000 persons with FAS

    • 73,000 under 18 years; 221,000 over 17

    • Lost potential productivity worth $1.9 billion in 2004

      Incidence % Prod. Reduction

Severe 2.5%100.0%

Moderate6.0%50.0%

Mild39.0%25.0%

Minimal52.5%10.0%

Average100.0%20.5%


Source: MMWR Dec. 24, 2004/ 53(50); 1178-1181


State Patterns of “At Risk” Drinking

“At risk” means binge or heavy drinking in past month


State Rates of Female “At Risk” Drinking Females age 18-44 years, Past Month Binge or Heavy Drinking

Estimated from 2002 BRFSS; U.S. average was 14.9%, or 8.4 million females


FAS Annual Costs by State, 2004($ in millions)


Are FAS InterventionsWorth Supporting?

  • IOM and NIAAA: very little strong research

  • Haven’t rigorously evaluated particular preventions

  • However, can look at potential benefit from successful prevention (Harwood and Napolitano, 1986)

  • What will benefits/savings be if save 1 child?


Cost Effectiveness

  • Standard allows comparison across all of health (PHS Taskforce; Gold et al., 1996)

  • Compares medical interventions on the basis of cost to save a quality adjusted life year (QALY)

  • Medical interventions costing <$50,000/QALY are “generally” considered “cost effective”


Perfect health: 1.0

Moderate disability: .50

Death/vegetativestate:0.0

Gen. pop. 35-39: .86

Gen. pop. > 75 years: .71

Congest. heart failure: .20

Legal blindness: .48

Profound deafness: .59

Depression: .31

Schizophrenia: .31-.61

Children withdevelopmental disability

Severe: .40

Moderate: .60

Mild .80

Reading disability: .77

Quality of Life Preference Scores

Harvard Center for Risk Analysis, on-line catalog of

published disease state preference scores


Impact of FAS on Quality of Life

  • Conservative estimate: FAS reduces QALY by 17% or 11 years

  • Potential savings from preventing 1 case of FAS:

    • $550,000 in total value of QALY

    • $258,000 in discounted value of QALY

  • If an intervention costs less than $516,000 per FAS case prevented (discounted indirect plus direct costs), it would be considered “generally cost effective”


Comparison of Birth Defect Costs

  • Lifetime costs of a birth with FAS $516,000

    • $2 billion for a birth cohort (for 4,000 FAS cases)

  • A study published by CDC estimated costs of birth defects in 1992 at $8 billion ($12-15 billion now)

  • Prematurity costs about $16 billion/year

  • Spina bifida and anencephaly > $750,000/birth

  • Mental retardation & cerebral palsy >$900,000/birth

  • Vision and hearing defects cost $400-600,000/birth


Summary

  • FAS costs US $4.6 billion in 2004

  • An FAS birth carries lifetime direct costs of $753,000 ($258,000 today) although can be as high as $3.7 million

  • FAS costs/birth similar to other severe birth defects

  • Costs vary widely by state, based on size and rates of female “at risk” drinking (CA $581 mil. WY $9 mil.)

  • Costs probably low: need better data on FAE, mental health, criminal justice

  • Even “expensive” FAS prevention may be “cost effective”: up to $516,000 per child


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