Employers increasingly are demanding cost-effective health
care, which has generated efforts to measure quantitatively the
overall economic burden of illness and the relative costs of individual
diseases. In this article, the authors sought to
determine the total price tag to employers for workers diagnosed with pneumonia. Although the direct costs for treating
pneumonia are known to be high, the authors conclude that employers may be significantly underestimating the total
financial burden, overlooking indirect costs and treatments for other problems related to a patient's pneumonia.
The annual per capita cost of pneumonia was determined for beneficiaries of a national Fortune 100 company by analyzing medical, pharmaceutical, and disability claims data. The costs for pneumonia patients were compared with a random sample of beneficiaries from the same employer population. Annual costs for the pneumonia patients were about 5 times higher than for the other workers. In addition, about 10% of the pneumonia patients accounted for a majority of the total pneumonia-related costs.
The authors found that, for every $1 spent on pneumonia health
care costs, the employer spent another $12 on direct and indirect
costs related to the worker's pneumonia. Failure to properly account
fully for these broader consequences of pneumonia could result
in a significant underassessment of the cost of pneumonia to employers.
Corresponding author and reprints: Howard G. Birnbaum, PhD,
Group/Economics, One Brattle Square, Fifth Floor, Cambridge, MA 02138 (e-mail:email@example.com). Accepted for publication July 31, 2001.
This study was supported by Aventis Pharmaceuticals.
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