Economic Burden

The economic consequences of NCDs includes three cost types (Suhrcke et al. 2008):

1) Social welfare costs—the value that people place on better health
2) Macroeconomic costs—the GDP losses countries incur due to ill health in the population.
3) Microeconomic costs—household financing of care, changes in consumption patterns, and forgone earnings of individuals and households due to the ill health among members.

Social Welfare Costs

To arrive at a health value, analyzing either how people act or how they answer certain questions related to real or hypothetical situations involving a trade-off between money and health can be done. This value also captures the intrinsic value of health. One study (Mahal et al. 2010), attempting to estimate the expected welfare benefits from a reduction in CVD mortality in India by 1 percent a year over 2000–2030, suggested an annual welfare gain equal to about three times that country’s GDP in 2000. Such high numbers reflect the substantial value that people attribute to reduced mortality and better health, a value that well exceeds any narrower economic cost measures.

Macroeconomic Costs

Careful recent studies have called into question the positive contribution of health to economic growth, an idea that earlier had been put forth strongly by the Commission on Macroeconomics and Health (WHO 2001). However, overcoming the econometric challenges in establishing causality, recent work using country-level data has brought a relatively new focus on NCD-related health proxies. Suhrcke and Urban (in press) have shown that high CVD mortality rates slowed economic development, especially among high-income countries, between 1960 and 2000. Results are less convincing for developing countries.

Rocco and Suhrcke (forthcoming) used another approach and, addressing data limitations, conclude that a reduction in global CVD deaths by 10 (out of 100,000 population) added 7 percent to per capita income over the observation period 1970–2000. In addition, analyses by Mahal et al. (2010), estimated that in India if NCDs were completely eliminated, estimated GDP would increase by 4–10 percent.

While elimination is not feasible nor a current, realistic goal, these findings give a sense of the impact that reductions might have. This new work provides support for the hypothesis that reducing NCDs i s good for economic growth, but more work is needed to substantiate the evidence.

Microeconomic Costs

Financing of Care

Treating chronic diseases, once they are expressed clinically, can be expensive to those affected. Chronic NCDs, by definition, require drug, inpatient, and outpatient treatment over a much longer period than acute communicable diseases.

Given existing health financing patterns in many low- and middle-income countries, the costs associated with chronic NCDs are likely to weigh more heavily on those least able to afford them, increasing the risk of economic loss and impoverishment. The poorer a country is, the more regressive the health care financing system tends to be and the higher the fraction of health costs borne by patients themselves (Gottret and Schieber 2006).