Using Disability Adjusted Life Years to Value the Treatment of Thirty Chronic Conditions in the U.S. from 1987-2010 (PDF)

Health care spending in the U.S. grew two trillion dollars from 1987 to 2010, a 400% increase, but our understanding of the value of that increase is limited. In this paper we determine the net value of spending at the disease level by assigning a monetary value to changes in health outcomes and relating it to the costs of treating the disease. Changes in health outcomes in the U.S. are measured using newly-available time series of Disability Adjusted Life Years (DALYs) from the Institute for Health Metrics and Evaluation. Spending on treatments are determined using health care expenditure data from nationally representative surveys. We examine the data for thirty chronic diseases for the period 1987 – 2010. For several diseases, we find the net value of treatment has grown substantially, consistent with medical technology improving over time and leading to better health outcomes at a lower cost per patient. Overall, twenty of the 30 chronic diseases studied experienced an increase in health outcomes over the period, with 8 of those 20 showing a decrease in per-patient spending. Our estimates of net value of spending using DALYs data are simple to apply and results are generally consistent with previous estimates of the value of spending on disease treatments, which usually involve onerous data collection methods to study only a single disease. The DALYs data have potential to be a useful, low-cost way to measure changes in health outcomes for diseases in which medical treatments are the primary driver of patient outcomes. However, another data source is necessary to properly measure the value of health care spending for other diseases.

Tina Highfill and Elizabeth Bernstein