May 1, 2006, 00:00 AM

10.1111/j.1524-4733.2006.00093.x

https://www.valueinhealthjournal.com/article/S1098-3015(10)64305-7/fulltext

Section Title :

Section Order : 6

First Page :

As US health-care expenditures continue to spiral upward, the value of this spending is increasingly questioned. General Motors (GM), once the leading manufacturer and the largest private employer in the United States, is nearly bankrupt, in large part because it spends $1500 in health-care costs per vehicle, whereas Toyota, which will shortly overtake GM in global auto production, pays only $201 per vehicle for health care in North America and $97 in Japan [1]. Although health-care costs are easy to measure as tangible taxes or paycheck deductions, health-care benefits are much harder to evaluate and quantify. The drivers of health-care cost increases are complex [2,3], but to develop appropriate policies to constrain or reorganize health-care spending, it is critically important to properly compare health-care costs with healthcare value.

In this issue of Value in Health, Luce et al. [4] provide a multifaceted assessment of the US return on investment for health-care expenditures, using three independent methodological approaches. Using (appropriately updated) societal life-year values of $99,000 to $173,000, and conservatively considering only the health care-related improvements in survival over past two decades, they find that a dollar of US health-care spending generates between $1.55 and $1.94 in overall health-care gains. Had they included the reductions in morbidity and improvements in employee productivity resulting from these expenditures, the returns on investment would have been even higher, but such gains are much more difficult to quantify than the survival improvements. When Luce et al. look at certain disease-specific results in the Medicare
program and at the broader cost-effectiveness literature, they corroborate their overall average estimates of return on investment with an impressive and independent diversity of additional positive findings.

https://www.valueinhealthjournal.com/action/showCitFormats?pii=S1098-3015(10)64305-7&doi=10.1111/j.1524-4733.2006.00093.x

HEOR Topics :

• Health Policy & Regulatory
• Public Spending & National Health Expenditures

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Regions :

• Global