Economic Costs of Diabetes in the U.S. in 2002

American Diabetes Association

Diabetes Care. 2003;26(3) 

In This Article

Abstract and Introduction

Objective: Diabetes is the fifth leading cause of death by disease in the U.S. Diabetes also contributes to higher rates of morbidity -- people with diabetes are at higher risk for heart disease, blindness, kidney failure, extremity amputations, and other chronic conditions. The objectives of this study were 1) to estimate the direct medical and indirect productivity-related costs attributable to diabetes and 2) to calculate and compare the total and per capita medical expenditures for people with and without diabetes.
Research Design And Methods: Medical expenditures were estimated for the U.S. population with and without diabetes in 2002 by sex, age, race/ethnicity, type of medical condition, and health care setting. Health care use and total health care expenditures attributable to diabetes were estimated using etiological fractions, calculated based on national health care survey data. The value of lost productivity attributable to diabetes was also estimated based on estimates of lost workdays, restricted activity days, prevalence of permanent disability, and mortality attributable to diabetes.
Results: Direct medical and indirect expenditures attributable to diabetes in 2002 were estimated at $132 billion. Direct medical expenditures alone totaled $91.8 billion and comprised $23.2 billion for diabetes care, $24.6 billion for chronic complications attributable to diabetes, and $44.1 billion for excess prevalence of general medical conditions. Inpatient days (43.9%), nursing home care (15.1%), and office visits (10.9%) constituted the major expenditure groups by service settings. In addition, 51.8% of direct medical expenditures were incurred by people >65 years old. Attributable indirect expenditures resulting from lost workdays, restricted activity days, mortality, and permanent disability due to diabetes totaled $39.8 billion. U.S. health expenditures for the health care components included in the study totaled $865 billion, of which $160 billion was incurred by people with diabetes. Per capita medical expenditures totaled $13,243 for people with diabetes and $2,560 for people without diabetes. When adjusting for differences in age, sex, and race/ethnicity between the population with and without diabetes, people with diabetes had medical expenditures that were ~2.4 times higher than expenditures that would be incurred by the same group in the absence of diabetes.
Conclusions: The estimated $132 billion cost likely underestimates the true burden of diabetes because it omits intangibles, such as pain and suffering, care provided by nonpaid caregivers, and several areas of health care spending where people with diabetes probably use services at higher rates than people without diabetes (e.g., dental care, optometry care, and the use of licensed dietitians). In addition, the cost estimate excludes undiagnosed cases of diabetes. Health care spending in 2002 for people with diabetes is more than double what spending would be without diabetes. Diabetes imposes a substantial cost burden to society and, in particular, to those individuals with diabetes and their families. Eliminating or reducing the health problems caused by diabetes through factors such as better access to preventive care, more widespread diagnosis, more intensive disease management, and the advent of new medical technologies could significantly improve the quality of life for people with diabetes and their families while at the same time potentially reducing national expenditures for health care services and increasing productivity in the U.S. economy.

Diabetes cost the U.S. an estimated $132 billion in 2002 in medical expenditures and lost productivity. Across the components of the health care system included in this study, per capita direct medical expenditures for the ~12.1 million people diagnosed with diabetes in the U.S. are more than double the expenditures of otherwise similar people without diabetes. A total of $92 billion in direct medical expenditures are attributable to diabetes. Diabetes is associated with higher rates of lost work time, disability, and premature mortality. The resulting economic loss to the U.S. economy in 2002 alone is estimated to be $40 billion. This cost estimate documents the extraordinary national economic burden of diabetes. Even so, such estimates do not account for the losses attributable to pain and suffering incurred by people with diabetes, as well as to families and friends of those with diabetes.

The prevalence of diabetes increases with age and is higher among certain racial and ethnic minority populations. The growth, aging, and increasing racial and ethnic diversity of the U.S. population portends a substantial increase in the size of the population with diabetes. If diabetes prevalence rates remained constant over time, controlling for age, sex, race, and ethnicity, then based on Census Bureau population projections[1], the number of people diagnosed with diabetes could increase to ~14.5 million by 2010 and to 17.4 million by 2020. The projected increase in the number of people with diabetes suggests that the annual cost in 2002 dollars of diabetes could rise to an estimated $156 billion by 2010 and to $192 billion by 2020. The actual cost in future years could be higher if the cost of health care outpaces the overall cost of living, or if the growing problem of obesity increases the prevalence of type 2 diabetes.

This national cost estimate represents an increase from estimates reported in earlier studies, reflecting the growing prevalence of diabetes in the U.S. and the increasing cost of health care services. Comparison of national cost estimates across studies is complicated by differences in the cost components included in each study, the continuing growth and aging of the U.S. population, and changes over time in the cost of health care services. The previous American Diabetes Association (ADA) study on the cost of diabetes estimated the national cost of diabetes in 1997 to be $98 billion[2].

Documenting the national economic impact of diabetes can inform priority setting in health care research and delivery, including prevention, diagnosis, and treatment of diabetes.

Unless specifically noted, this study uses prevalence-based cost-of-illness methods similar to the approach used by ADA[2,3]. The following is an overview of the research design and methods used for this study, a discussion of important findings, and a summary of the implications of these findings, limitations of the study, and suggestions for future research.