Advances in health care over the past few decades have helped people live longer, better lives. In fact, both mortality and disability rates have fallen steadily since the 1970s. This period also has seen a significant increase in our health care spending. Has this increase been worth it?

A new study authored by MEDTAP International and released by a broad coalition of health care groups answers that question with a resounding “Yes.” The report was released by the Advanced Medical Technology Association (AdvaMed), American College of Cardiology, American Hospital Association, Federation of American Hospitals, Healthcare Leadership Council, National Pharmaceutical Council, and PhRMA.

According to the report, “The Value of Investment in Health Care,” each additional dollar spent on health care in the past 20 years has produced health gains worth $2.40 to $3.00. [1]

The study underscores the significant role that medicines introduced over the past 20 years have played in achieving these gains.

As a result of increased investment in health care between 1980 and 2000, life expectancy has climbed from 77.4 to 79.5 for women and from 70.0 to 74.1 for men (see chart). Death rates in the entire population have fallen from the 1980 level of 1039.1 deaths per 100,000 people to 872.0 in 2000. Likewise, disability rates for seniors have tumbled from 26.2% in 1980 to 19.7% in 2000.

Innovative new medicines make it possible to prevent or slow the progress of many diseases and avoid costly hospitalization and invasive surgery. Between 1980 and 2000, the number of hospital days fell from 129.7 to 56.6 per 100 people, a drop of 56%. As a result, Americans avoided 206 million days of hospital care in 2000 alone because of our investment in health care.

New medicines contribute to these gains by preventing diseases and treating them more effectively. The MEDTAP report examines four diseases – breast cancer, diabetes, heart attack and stroke – and reports on peer-reviewed literature that measures the value of medical advances against these diseases.

According to the report by MEDTAP, the value of health gains achieved by medicines to treat these four diseases far exceeds the additional money spent on them. For example:

• Every additional dollar spent on comprehensive heart attack patient care results in $1.10 in health gains and each dollar invested in beta-blockers for heart attack patients returns $38.44 (see chart);
• Each dollar spent on antiplatelet therapy for preventing stroke in high-risk patients provides health gains valued at $2.00 to $6.00, while a $1 investment in general stroke health care returns $1.55 in health gains.

These numbers illustrate the recent statement by FDA Commissioner Mark McClellan: “[T]he value of gains in life expectancy seen in the US is greater than the total value of all the measured growth in our economic output. New drugs are no small part of this medical miracle." [2]

The report by MEDTAP offers important new findings that quantify improvements in health that have resulted from increased health care spending. These findings should play a significant role in the debate over what kind of health care America will have in the 21^st century.

This report builds on extensive research pointing to the value of medicines to treat diseases like diabetes and breast cancer care. Upcoming issues of Value in Medicines will examine these findings in more detail.

For more information:

Full text of the report – www.medtap.com

Value of Investment in Health Care.pdf

Value of Investment in Health Care Executive Summary