When we talk about the economic burden of disease, we first think of the medical expenses that arise due to diagnostics, outpatient and inpatient medical treatments, consumption of drugs and medical devices, rehabilitation and all preventive health programs. These are the direct medical costs of the disease. They are the most visible, as they are created in the healthcare system and are generally the easiest to measure. But every disease has much wider consequences.
In addition to treatment costs, patients and their families are often burdened with direct non-medical costs, such as transportation to medical appointments and adjustments to diet and living environment. If individuals have to cover such costs out of their own pockets, they can worsen their financial situation. At the beginning of the last decade, for example, the study of the financial toxicity of cancer intensified when the profession noted that high out-of-pocket costs to patients were a particular form of adverse effect. treatment of cancer diseases. Research in this area has developed because financial hardship affects quality of life, access to care, and also the patient’s behavior during treatment.
Loss of productivity
An individual’s health condition also affects their independence, ability to perform daily activities and ability to work. Every chronic disease, physical impairment, disability or premature death therefore not only means a health problem for the individual patient and his relatives, but also indirect costs caused by loss of productivity are an important part of the economic burden of the disease. This occurs when an individual works less, less efficiently or even withdraws from the labor market due to illness.
Petra Došenović Bonča emphasized that without investments in health care, it is not possible to improve the management of the social burden of disease and to increase the functional and work capabilities of all of us. PHOTO: Tania Mendillo
The loss of productivity therefore occurs in the case of presenteeism, when an individual is present at the workplace, but works less efficiently due to health problems. It can be the result of short-term or long-term sick leave, disability retirement, unemployment or withdrawal from the labor market due to illness, or in the case of a serious chronic illness, also due to premature death. We must not forget the loss of unpaid work, as self-sufficiency also contributes significantly to social well-being. In addition to direct and indirect costs, there are also intangible costs caused by pain, fear, social exclusion and other factors of reduced quality of life, which should also not be neglected, although they are generally difficult to evaluate.
Although we have the most data on direct health expenditure within our health system, it should be noted that indirect costs due to lost productivity and informal care for many diseases such as cancer, cardiovascular disease and dementia are comparable to or even higher than health expenditure.
Economic burden of disease
The main insight from studying both the epidemiological and economic burden of such diseases is interesting. Due to the increasing incidence and prevalence of certain chronic diseases, which is a result of the aging of the population and changes in lifestyle, there is increasing pressure on health funds and the need to increase, in particular, public sources of health financing. But this cannot be ensured without economic growth, which actually has only two key factors. These are the size of the working population and their efficiency and productivity.
An interesting feedback loop is revealed in this realization. Although for investments in healthcare today we need resources that we often hear cannot be provided without investments in healthcare today resources for financing healthcare cannot be expected tomorrow. No investments in healthcare today it is not possible to improve the management of the social burden of disease and to increase the functional and working capacity of all of us, which can ensure prosperity for us and future generations tomorrow.
Is there even a way out of this vicious circle of seemingly unsustainable rising costs in healthcare? The first necessary step is to change the mindset that healthcare is a burden on the economy. Healthcare is not a burden on the economy, but an important factor in its growth. If we want to change the impression that health care is like a bottomless pit into which the growing volume of public financial duties flows, we must take every decision in health care as responsibly as in all other areas where we have limited resources.
In a situation of limited resources, it is necessary to manage! This requires that we not only deal with costs, but that for each investment we also monitor the achieved health outcomes of the population, which should also translate into better outcomes on the labor market and greater social welfare. We therefore need investment thinking, which in healthcare means that expenditures for effective health programs, prevention, early treatment and rehabilitation are also assessed from the point of view of their ability to maintain health, working capacity and independence of the population. Such an approach goes beyond short-term cost containment and raises the question of which health technologies create the greatest value for patients, the health system and society as a whole. Healthcare should therefore be considered as a strategic investment in human capital, social inclusion and the future development capacity of the country.
Formulation of priorities
Healthcare should be considered as a strategic investment in human capital, social inclusion and the future development capacity of the country. PHOTO: Blaž Samec/Delo
Such an approach is also important because it enables a better formulation of research priorities and overcoming the silo thinking that we all too often witness. Siled operation in healthcare means that decisions, data, responsibilities and financial incentives are formed within individual organizations, treatment levels or departments. Such fragmentation can lead to duplication of services, poorer coordination between providers, shifting of costs between health and other social security systems, and neglect of positive effects that occur outside the direct budget of the health system. Above all, silos can only lead to cost overruns, which does not mean actual control of the disease burden, but merely a change in the stakeholder who bears the costs – patient, family, employer, health system or state budget. When assessing health technologies, this means that their value can be quickly underestimated or overestimated if the broader social effects are ignored.
Consensus at the principle level that it is reasonable and necessary to take into account the wider social effects of new health technologies is not difficult to achieve. However, it must be admitted that this is much more difficult to implement in practice. Proving the value of new health technologies, such as new drugs, diagnostic procedures or models of integrated treatment, is challenging even if analyzes of their economic efficiency are prepared from the point of view of the public payer, i.e. in our case from the point of view of ZZZS. Analyzes from a social perspective are even more demanding, as in addition to changes in health outcomes, they also require monitoring a wide range of other effects on quality of life, loss of productivity, needs for informal care and the impact on unpaid work.
Data on these effects are often not comprehensive, but are scattered among different administrative sources or based on self-reporting, adding to the uncertainty that payers of new health technologies face in making decisions. An additional challenge is the monetary valuation of effects that do not have a clear market price, such as informal care, reduced work capacity or loss of quality of life. There is also the risk of counting the same effects multiple times, especially when costs of illness, lost productivity and intangible consequences overlap. Therefore, analyzes of the broader social effects of the disease require a well-considered selection of data sources, a consistent methodology for evaluating individual categories of costs and effects, and above all, the elimination of gaps in the competences of all relevant stakeholders in healthcare, which are necessary for assessing the economic efficiency of healthcare technologies.
Developers of new health technologies, especially drugs, generally have extensive clinical, regulatory, pharmacoeconomic and data knowledge about their own technology, while decision makers often have limited analytical capacity, less access to data and fewer opportunities to independently verify assumptions, models and long-term effects. Such asymmetry of knowledge can reduce the transparency of decision-making, complicate the critical assessment of evidence and weaken public confidence in the fairness and professional validity of decisions.
Therefore, strengthening the competence of decision-makers, access to independent data and methodological transparency is the key to more balanced, responsible and trustworthy decision-making on the integration of new technologies into the healthcare system. Above all, it is necessary to overcome the mentality that proving value is the sole task of developers of new technologies. This is the responsibility of all stakeholders. For healthcare decision-makers, a shift from passive assessment of the presented evidence to active creation of conditions for high-quality and data-supported decision-making is necessary. Decision-makers must be co-creators of a data and institutional environment in which the value of technologies can first be credibly assessed, and then realized for the benefit of all of us.
Assoc. prof. dr. Petra Došenović Bonča, head of the Master’s program Management and Economics in Healthcare, Faculty of Economics, University of Ljubljana.
