How Do You Value What Didn't Happen?

Karen Starko writes: When the "financial crisis" started and the news media started throwing around numbers in the trillions and projected fixes in the billions, I realized I just didn't get it. So I got a little yellow post-it, labeled it "understanding trillions," and started a list of examples. And when I learned that the US GDP in 2006 was 13T and the derivative market, estimated in June 2007, was valued at 500T, I quickly got a sense of the potential drain of the derivative market (in which money is spent on items without real definition, please correct me if I am wrong). I was scared. I thought of taking my cash from the bank and converting into something tangible, like food, but decided to hold on and hope the government would "save" us. We now all are learning that we didn't pay enough attention and what we lost is painfully real in terms of our financial health.

As I read Mark's book, I began thinking about whether we are in the same situation with our physical and mental health. Are we paying enough attention to that which produces real value, like prevention, a key strategy of the EIS and other prevention-oriented organizations?

First, a little perspective...CDC's budget request for 2010 was 10.1 billion. ( including:
3.3 B for childhood vaccines
2.0 B for infectious diseases
1.5 B for terrorism
1.0 B for health promotion

In 2006, it was estimated that bringing a single drug to market costs 0.5 to 2 billion. ( A Reuters report in April 2010 ( indicated that consensus forecasts for sales figures for the top selling drugs ranged from 11.7 billion for Lipitor to 5.8 billion for Crestor with Plavix, Advair, Remicade, Enbrel Humira, Avastin, Rituxan, Diovan in between.

So we spend almost 12 B on our top selling drug and 10 B on the entire CDC budget. Is this how we want to spend our money? Now don't get me wrong I am all for drugs (medical). And I am not implying that a 12 billion for one drug isn't worth it. Rather, the relative amount spent for the prevention and health promotion work of CDC seems a bit low.

An important question then is: How do you understand the value of prevention efforts? While we do a pretty good job measuring the benefit we get from each drug in its formal clinical trials, can calculate cost benefit, and can use this information to make choices about how we spend our dollars, measuring what didn't happen (what we prevented) is much more difficult involving projections, assumptions, and discounting.

Here is where Mark's book comes in. Inside the Outbreaks is the first book chronicling the work of the EIS. Each sub-section tells a brief story and as you read through the book, you develop a growing knowledge and appreciation for what illnesses did and, importantly, didn't happen. For example, for each of these diseases, it is clear that many illnesses and deaths were prevented.

--In 1965, a Salmonella outbreak afflicted about 200,000 people in Riverside, California killing an infant and several others before the CDC team found that water was the source and stopped the outbreak.
-- In 1966, the World Health Organization passed a vote to fund a worldwide small pox elimination program. CDC played an important role in the subsequent eradication program.
--CDC was a leader in identifying infections that originated in hospitals and in instituting surveillance and preventive programs.
--Lead poisoning, vinyl chloride associated liver cancer, toxic shock syndrome and tampons, Accutane-associated birth defects, and many other links between an environmental cause and health were identified or characterized by CDC studies.

How many thousands or millions of us are healthy today because of this work? And how many suffer because we didn't do more of this kind of work? I suggest that a general appreciation and awareness is a first step in placing value. Pendergrast's book goes a long way in providing this. Once we truly understand and appreciate, we can think about measuring value. Was the money we spent worth it? Could we have done more with more? If we have a dollar for our health today, where do we think we will get the most value? Would more funds toward prevention give us more of the health value we want?

Are we headed for another crisis, one caused by spending dollars on health products of lesser (or no) value rather than those of more value resulting in slowing improvements or decreases in our health...a health recession?


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Kudos to Karen Starko for this eloquent and statistically compelling post. Indeed, the CDC and all public health efforts are underfunded. I have few criticisms of public health heroes, but one of them is that they tend to come hat-in-hand to Congress, assuming that level funding or something maybe a little better is all they can expect. Instead, they should be screaming and yelling and making these same points and comparisons that Karen makes. At least we can do some screaming and yelling on this blog.

"How many thousands or millions of us are healthy today because of this work [EIS-type investigations]?" Karen wrote. "And how many suffer because we didn't do more of this kind of work? I suggest that a general appreciation and awareness is a first step in placing value. Pendergrast's book goes a long way in providing this."

I certainly hope so. Sometimes I feel as though we are fighting the tide. During all the media coverage of the debate over health care reform, and the nutty protests that somehow providing decent primary health care for people was a socialistic plot, I kept waiting for a discussion of prevention and public health efforts. But I never heard it. Maybe I just missed it? So when the public radio show "Marketplace" approached me to appear on the show to talk about my new book, I was thrilled. Then it got nixed, because public health issues are not sufficiently relevant to the economic focus of the show. What??? I pointed out that this is precisely the point that we should be looking at in terms of health care reform. And I sent them the two following segments from the book. All to no avail, I should add:

One Friday afternoon in mid-September, Levy got a call from a health officer in the town of Owatonna. Eight employees of a local insurance company had been hospitalized that morning. They had attended a company picnic on Tuesday night catered by Hoffâs Bar, and some had also eaten at the barâs weekly smorgasbord the following night. Levy spent that weekend interviewing patients, tracking down others who attended the picnic and/or smorgasbord, and administering a questionnaire about what foods they had eaten.

Levy suspected Salmonella. (The lab later identified S. schwarzengrund.) Of the 173 people who ate at the picnic or smorgasbord, 125 became ill, yielding a 74 percent overall attack rate. The questionnaire results implicated potato salad. Fried chicken had also been served at both meals. Levy found that the bar owner had stored raw chicken in plastic pans in which he then prepared the potato salad. The bacteria from the raw poultry cross-contaminated the potato dish, then multiplied at room temperature for a few hours.

Levy calculated that the hospital expenses, visits to doctors, lost salaries and productivity of sick workers, economic impact on the restaurant, and cost of the investigation approached $30,000. The average cost of inspecting a Minnesota restaurant was $10.70. Levyâs medical paper with these figures was summarized by EIS alum Larry Altman, a New York Times science reporter, and then Time magazine picked up the story.

And here is the second excerpt:

In 1994, EIS officer Mike Siegel, assigned to the CDC Office on Smoking and Health, conducted a cost-benefit analysis of tobacco in the state of Georgia. âFor a long time, most Southern states had ignored this health issue,â Siegel said, âbecause of the powerful tobacco industry lobby.â
In the previous full year, Georgia farmers had grown 96.3 million pounds of tobacco and sold it for $159 million. Revenue from sales of cigarettes, cigars, and chewing tobacco amounted to $1.203 billion, with another $176 million flowing in from state tobacco taxes. Tobacco provided jobs, directly or indirectly, for 35,860 people who earned $1.230 billion. Thus, the annual economic benefit of the nicotine-laden plant came to $2.768 billion.
Annually in Georgia there were 10,650 smoking-attributable deaths from cancer, heart disease, respiratory failure, and fetal/infant fatality. That translated to 177,424 years of potential life lost due to premature smoking deaths. Siegel estimated the stateâs direct and indirect smoking-related medical costs at $2.9 billion per year, while smoking had caused 91.4 million work-loss and bed-disability days in Georgia in 1993, amounting to $6 billion in lost productivity. Thus tobacco cost about $8.9 billion per year. Siegel presented his findings to the Coalition for a Healthy and Responsible Georgia (CHARGe), which pushed for and eventually got smoke-free restaurant legislation in the state.
Siegel also studied the impact of brand-specific cigarette advertising on youth smoking, demonstrating that the three most heavily advertised brands â Marlboro, Camel, and Newport â were also the most popular among the three million adolescent smokers in the United States. The rate of teenage smoking began to rise in 1988, the year that the Joe Camel campaign launched nationally. Camelâs market share among teens rose by 5.2 percent from 1989 to 1993, as advertising spent on the brand increased from $27 million to $43 million annually.
Siegel testified in seven tobacco cases as an expert witness, leading in part to the massive 1998 nationwide Tobacco Master Settlement Agreement in which the industry agreed to pay $206 billion and sponsor anti-smoking ads. As a result, a pack of cigarettes cost 40 cents more, and youth smoking rates began to drop. --Mark Pendergrast