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The Value of Elderly Disease Prevention


  • Goldman Dana P

    () (RAND Corporation and NBER)

  • Cutler David M

    () (Harvard)

  • Shang Baoping

    () (RAND)

  • Joyce Geoffrey F

    () (RAND)


Approximately 100 million elderly will enter Medicare over the next 25 years. We consider the potential benefits of interventions that would reduce or eliminate the most important risk factors for disease and spending. Effective control of hypertension could reduce health care spending $890 billion for these cohorts while adding 75 million disability-adjusted life years (DALYs). Eliminating diabetes would add 90 million life-year equivalents at a cost of $2,761 per DALY. Reducing obesity back to levels seen in the 1980's would have little effect on mortality, but yields great improvements in morbidity (especially heart disease and diabetes) with a cost savings of over $1 trillion. Smoking cessation will have the smallest impact, adding 32 million DALYs at a cost of $9.045 per DALY. While smoking cessation reduces lung disease and lung cancer, but these are relatively low prevalence compared to the other diseases. Its impact on heart disease is negligible. The effects on overall social welfare are unknown, since we do not estimate the costs of these interventions, the costs of any behavioral modification, or the welfare loss due to providers from lower medical spending.

Suggested Citation

  • Goldman Dana P & Cutler David M & Shang Baoping & Joyce Geoffrey F, 2006. "The Value of Elderly Disease Prevention," Forum for Health Economics & Policy, De Gruyter, vol. 9(2), pages 1-29, January.
  • Handle: RePEc:bpj:fhecpo:v:biomedical_research:y:2006:n:1

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    References listed on IDEAS

    1. Town, Robert & Vistnes, Gregory, 2001. "Hospital competition in HMO networks," Journal of Health Economics, Elsevier, vol. 20(5), pages 733-753, September.
    2. repec:mpr:mprres:3164 is not listed on IDEAS
    3. Anil Bamezai & Jack Zwanziger & Glenn A. Melnick & Joyce M. Mann, 1999. "Price competition and hospital cost growth in the United States (1989-1994)," Health Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 233-243.
    4. Melnick, Glenn A. & Zwanziger, Jack & Bamezai, Anil & Pattison, Robert, 1992. "The effects of market structure and bargaining position on hospital prices," Journal of Health Economics, Elsevier, vol. 11(3), pages 217-233, October.
    5. Shen, Yu-Chu, 2003. "The effect of financial pressure on the quality of care in hospitals," Journal of Health Economics, Elsevier, vol. 22(2), pages 243-269, March.
    6. David M. Cutler & Mark McClellan & Joseph P. Newhouse, 2000. "How Does Managed Care Do It?," RAND Journal of Economics, The RAND Corporation, vol. 31(3), pages 526-548, Autumn.
    7. McClellan, Mark & Cutler, David & Newhous, Joseph P., 2000. "How Does Managed Care Do It?," Scholarly Articles 2643884, Harvard University Department of Economics.
    8. repec:mpr:mprres:3515 is not listed on IDEAS
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    Cited by:

    1. Pierre-Carl Michaud & Dana Goldman & Darius Lakdawalla & Adam Gailey & Yuhui Zheng, 2009. "International Differences in Longevity and Health and their Economic Consequences," NBER Working Papers 15235, National Bureau of Economic Research, Inc.
    2. Knai, Cecile & Suhrcke, Marc & Lobstein, Tim, 2007. "Obesity in Eastern Europe: An overview of its health and economic implications," Economics & Human Biology, Elsevier, vol. 5(3), pages 392-408, December.
    3. Suhrcke, Marc & Urban, Dieter M. & Moesgaard Iburg, Kim & Schwappach, David & Boluarte, Till & McKee, Martin, 2007. "The economic benefits of health and prevention in a high-income country: the example of Germany," Discussion Papers, Research Group Public Health SP I 2007-302, Social Science Research Center Berlin (WZB).
    4. Jinjing Li & Cathal O'Donoghue, 2013. "A survey of dynamic microsimulation models: uses, model structure and methodology," International Journal of Microsimulation, International Microsimulation Association, vol. 6(2), pages 3-55.

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