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The Economic Costs of Diabetes

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Abstract

Diabetes care involves three types of economic consequences: (1) direct costs, resources used to prevent, detect, diagnose, and treat diabetes; (2) indirect costs resulting from loss of productivity, absenteeism, early retirement, disability, and death; and (3) intangible costs from the effect of diabetes on quality of life. The economic costs of diabetes have involved two areas: (1) the cost of illness, which initially only compared direct and indirect costs between people with diabetes and without diabetes, and (2) the cost of interventions through cost-effectiveness analysis. The cost of illness approach is a descriptive type of study relating all costs to a specific disease and involves two approaches: top-down or burden of disease studies and person-based, bottom-up studies. Top-down studies involve the direct costs of illness, including inpatient care, outpatient services, and nursing home care, and have particularly focused on the progressive and lifetime costs of complications and comorbidities. Bottom-up studies involve societal costs and quality-of-life measures. Costs of illness studies include cross-sectional and incidence-based approaches. The former have confirmed the impact of diabetes per capita and the large proportional impact of diabetes on health systems, while incidence-based studies have shown the incremental medical care costs of diabetes before and after diagnosis, showing that the rise in medical spending begins well in advance of the diagnosis of diabetes, accelerates as diagnosis approaches, immediately afterwards, and steeply increases among patients with complications. The global cost of diabetes for 2019 was estimated at 760 billion US dollars, accounting for 1–8% of the global gross domestic product, and its main drivers are poor glycemic control, medications, hospitalizations, macrovascular/microvascular complications, and individual characteristics, including the number of medical visits and comorbidities. People with diabetes have medical expenditures two to three times higher than people without diabetes, accounting for one in four health care dollars. Compared to people without diabetes, people with diabetes receive more medical services, including outpatient visits, hospital admissions, accidents, and emergency department attendances. Hospital admissions account for two-thirds of costs, of which a large proportion are avoidable and related to deficiencies in outpatient care. The economic analysis of interventions includes comparisons of health care utilization and costs between cohorts of patients with good glycemic control and patients without improvement documenting significant savings within 1 or 2 years of improvement and cost-effectiveness analysis of intensive glycemic and metabolic control. Achieving glucose, cholesterol, and blood pressure targets in patients with type 2 diabetes leads to substantial gains in clinical outcomes, a lower incidence of diabetes complications, and quality-adjusted life years (QALYs). Randomized clinical trials in patients with type 1 and type 2 diabetes have shown significant increases in direct costs but substantial reductions in the risk and cost of complications and more time free of complications. Underlying factors driving the rising costs of diabetes include deficiencies in health systems and changing demographics associated with increased life expectancy and aging. To make matters worse, many patients with diabetes struggle to pay medical bills or to pay them at all. To reduce the out-of-pocket costs of prescription drugs, patients resort to several strategies including self-treatment, avoiding taking medications, or asking doctors to prescribe lower-priced medications with negative consequences to their health. Albeit still limited in scope, the study of diabetes costs confirms the increasing impact of the disease on people with diabetes, their families, national health systems, and societies and represents a call for action to respond in a comprehensive manner to all phases in the natural history of the disease, at the primary and secondary prevention levels, and stresses the importance of improving the quality of diabetes care to reduce human suffering and economic waste.

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Notes

  1. 1.

    Modified from [101,102,103].

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Further Reading

  • Bootman JL, Townsend RJ, McGhan WF, editors. Principles of pharmacoeconomics. 2nd ed. Harvey Whitney: Cincinnati; 1998.

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  • Drummond MF, Sculpher MJ, Claxton K, Stoddart GL, Torrance GW. Methods for the economic evaluation of health care programmes. 4th ed. New York: Oxford University Press; 2015.

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  • Gold MR, Siegel JE, Russell LB, Weinstein MC, editors. Cost-effectiveness in health and medicine. Nueva York: Oxford University Press; 1996.

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  • Eastman RC, Javitt JC, Herman WH, Dasbach EJ, Zbrozek AS, Dong F, et al. Model of complications of NIDDM. I Model construction and assumptions. Diabetes Care. 1997;20:725–34.

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Author information

Authors and Affiliations

  1. Multidisciplinary Diabetes Center Mexico, Mexico City, Mexico

    Joel Rodriguez-Saldana

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  1. Joel Rodriguez-Saldana
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Editors and Affiliations

  1. Mexico City, Mexico

    Joel Rodriguez-Saldana

Glossary

Modified from [101,102,103].

Cost

The value of resources engaged in a service.

Cost-benefit analysis

An analysis to consider the economic and social costs of medical care and the benefits of reduced loss of net earnings for preventing death or disability. A method for comparing the value of the outcome of all resources consumed (costs) by an intervention against the value (benefits) of the outcome.

Cost-effectiveness analysis

A method designed to assess the comparative impact of expenditures on different health interventions. Identifying, measuring, and comparing the significant costs and consequences of alternative interventions to determine the degree to obtain the desired objectives or outcomes.

Cost-effectiveness ratio

A comparison between alternatives, the difference in cost divided by the difference in effectiveness.

Cost-utility analysis

Economic evaluation in which the outcomes of alternative interventions are expressed in single “utility-based” units of measurement. The most appropriate approach when quality of life is an important outcome.

Direct costs

Diagnosis and treatment costs borne by the health system, the community, and patient families.

Health economics

Monetary or humanistic trade-offs between wants, needs, and the scarcity of resources to fulfill these wants.

Incremental costs

Difference between marginal costs of alternative interventions.

Indirect costs

Lost productivity caused by disease to the individual, the family, the society, or the employer.

Intangible costs

Costs of pain, grief, suffering, loss of leisure time, years of life lost.

Outcomes

The results and value of medical interventions. Multidimensional and dependent on three perspectives: clinical, economic, patients’. The true value of health care interventions can only be assessed if all three dimensions of outcomes are measured and considered.

Pharmacoeconomic research

Identification, measurement, and comparison of costs (resources consumed) and consequences (clinical, economic, humanistic) of pharmaceutical products and services.

Pharmacoeconomics

Description and analysis of the costs of drug therapy to health care systems and society.

Quality-adjusted life years

Adjustment measure that reduces life expectancy, reflecting the existence of chronic conditions causing impairment, disability, and/or handicap as assessed from health surveys, hospital discharge data, or others.

Total costs

All costs incurred in producing a set of services.

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Rodriguez-Saldana, J. (2023). The Economic Costs of Diabetes. In: Rodriguez-Saldana, J. (eds) The Diabetes Textbook. Springer, Cham. https://doi.org/10.1007/978-3-031-25519-9_3

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