The Cost of Diabetes

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Abstract
This paper estimates the cost of diabetes in England and Wales in 1984 to be in excess of £259.5 million. The costing methodology used follows the ‘cost of illness’ framework. This framework defines three elements for costing: direct, indirect and psychological, although the latter element is left out of the calculation because monetary valuations for this element have never been adequately estimated. Direct costs include resources used to prevent, detect, and treat diabetes. Indirect costs relate to the loss of productive output caused by absenteeism, early retirement, and premature mortality. The estimate which has been obtained is likely to be an underestimate because of the weaknesses and gaps in the data sets. The estimate of the total lost earnings from diabetes varied greatly according to the choice of absentee rate. If there was no significant difference between absenteeism in the diabetic community and the non-diabetic community then the cost of diabetes would be £259.5 million. If on the other hand the diabetic community was prone to three times as much absenteeism as the non-diabetic community then the cost of diabetes would rise to £602.5 million. The costs of diabetes as a subsidiary diagnosis are extremely difficult to identify. They have been estimated in this study to be £86 million but this is thought to be an overestimate. Nevertheless the cost of diabetes is significant and thus the search for more efficient treatment regimens may reduce such costs as well as enhance the quality of life of the patients concerned. Important policy conclusions to be drawn from this analysis are to improve the epidemiological underpinning upon which such estimates are based and to increase the use of economic evaluation, rather than ‘cost of illness’ methodology, to assist in priority-setting in health care.