The Economic Impacts of Diabetes

Diabetes imposes a large economic burden on the individual, national healthcare system and economy. Healthcare expenditures on diabetes are expected to account for 11.6% of the total healthcare expenditure in the world in 2010. About 80% of the countries covered in this report are predicted to spend between 5% and 13% of their total healthcare dollars on diabetes.

Global healthcare expenditure

Estimated global healthcare expenditures to treat and prevent diabetes and its complications are expected to total at least US Dollar (USD) 376 billion in 2010. By 2030, this number is projected to exceed some USD490 billion. Expressed in International Dollars (ID), which correct for differences in purchasing power, estimated global expenditures on diabetes will be at least ID418 billion in 2010, and at least ID561 billion in 2030. An estimated average of USD703 (ID878) per person will be spent on diabetes in 2010 globally.

Expenditures spent on diabetes care are not evenly distributed across age and gender groups. The estimates show that more than three-quarters of the global expenditure in 2010 will be used for persons who are between 50 and 80 years of age. Also, more money is expected to be spent on diabetes care for women than for men.

Disparities in healthcare spending

There is a large disparity in healthcare spending on diabetes between regions and countries. More than 80% of the estimated global expenditures on diabetes are made in the world’s economically richest countries, not in the low- and middle-income countries where over 70% of people with diabetes live.

One country, the United States of America, is projected to spend USD198 billion or 52.7% of global expenditure in 2010, while India, the country with the largest population of people living with diabetes, is expected to spend an estimated USD2.8 billion, or less than 1% of the global total. An estimated average of USD7,383 per person with diabetes is expected to be spent on diabetes-related care in the USA but less than USD10 per person will be spent in Burundi, Côte d’Ivoire and Myanmar in 2010.

The financial burden borne by people with diabetes and their families as a result of their disease depends on their economic status and the social insurance policies of their countries. Those living in low-income countries pay a larger share of the expenditure because of poorer organized systems of medical care insurance and/or lack of public medical services. In Latin America, for instance, families pay 40-60% of medical care expenditures from their own pockets. In the poorest countries, people with diabetes and their families bear almost the whole cost of the medical care they can afford.

Impact on the economy

Besides excess healthcare expenditure, diabetes also imposes large economic burdens in the form of lost productivity and foregone economic growth. The American Diabetes Association estimated that the US economy lost USD58 billion, equivalent to about half of the direct healthcare expenditure on diabetes in 2007, as a result of lost earnings due to lost work days, restricted activity days, lower productivity at work, mortality and permanent disability caused by diabetes. Such losses are perhaps relatively larger in poorer countries because premature death due to diabetes occurs at much younger ages. The World Health Organization (WHO) predicted net losses in national income from diabetes and cardiovascular disease of ID557.7 billion in China, ID303.2 billion in the Russian Federation, ID236.6 billion in India, ID49.2 billion in Brazil and ID2.5 billion in Tanzania (2005 ID), between 2005 and 2015.

The largest economic burden, therefore, is the monetary value associated with disability and loss of life as a result of the disease itself and its related complications. This economic burden, however, can be reduced by implementing many inexpensive, easy-to-use interventions, most of which are cost-effetive or cost-saving, even in the poorest countries. Nonetheless, these interventions are not widely used in low- and middle-income countries.

Accuracy of estimates

A relatively simple formula to derive the country estimates in this report was used. The accuracy of these estimates is subject to how well assumptions used in the formula fit the situation of each individual country. The estimated per capita expenditure on diabetes was compared with independent estimates obtained from industrialized countries where direct studies of diabetes costs have been conducted, and found to be reasonably accurate. In general, these estimates are less accurate for LMCs because of poor quality data, underlining the need for well-designed health economic studies to understand the true impact of diabetes.

The background paper, Economic Impact of Diabetes, and country by country estimates on which this summary is based are available in the Downloads section.

Map 2.6 Mean health expenditure per person with diabetes (USD), R = 2, 2010

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