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Economic Costs of Fetal Alcohol Spectrum Disorders

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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  1. Economic Costs of Fetal Alcohol Spectrum Disorders byHenrick Harwood FASD Field Trainers Meeting Orlando, FloridaDecember 2, 2005

  2. 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

  3. 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.

  4. 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

  5. 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

  6. Different Types of Economic Studies • Cost of illness • Cost effectiveness • Cost benefits

  7. 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

  8. 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

  9. 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

  10. 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

  11. 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

  12. 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)

  13. Economic Cost of FAS in U.S., in 2004 • National • Direct: $2.66 billion • Indirect: $1.90 billion • Total: $4.56 billion

  14. Major Direct Cost Components

  15. Major Direct Cost Components (cont.)

  16. Worst Case Expected Case Direct Costs per Year, per FAS Case Health Cost/Year Age

  17. 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

  18. 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

  19. 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% Moderate 6.0% 50.0% Mild 39.0% 25.0% Minimal 52.5% 10.0% Average 100.0% 20.5%

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

  21. State Patterns of “At Risk” Drinking “At risk” means binge or heavy drinking in past month

  22. 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

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

  24. 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?

  25. 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”

  26. 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

  27. 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”

  28. 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

  29. 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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