[EQ] Economic implications of health inequalities in the European Union

Economic implications of health inequalities in the European Union

Prof. Dr. Johan (J.P.) Mackenbach, Dr. Willem Jan (W.J.) Meerding, Dr Anton (A.E.) Kunst
Erasmus MC - Department of Public Health -  Rotterdam -The Netherlands
University Medical Centre Rotterdam
The European Commission - July 2007

Available online PDF [166p.] at: 

http://ec.europa.eu/health/ph_determinants/socio_economics/documents/socioeco_inequalities_en.pdf 

"....The authors first calculated the inequalities related losses to population health in the European Union in 2004. 
 They then estimated various economic effects of those health losses, including health care costs, costs of social 

security schemes, losses to Gross Domestic Product through reduced labour productivity, and the monetary value 

of total losses in welfare.

Inequalities-related losses to health amount to more than 700,000 deaths per year, and 33 million prevalent cases 

of ill-health, in the European Union as a whole. These losses account for 20% of the total costs of health care, 

and 15% of the total costs of social security benefits. Inequalities-related losses to health also reduce labour productivity 

and take 1.4% off GDP each year. The total monetary value of health inequalities-related welfare losses is in the 

order of €1000 billion per year......"

".....Most analyses of the relationship between health and the economy focus on average health, but health is actually 

very unevenly distributed across society. In all countries with available data, significant differences in health exist 

between socioeconomic groups, in the sense that people with lower levels of education, occupation and/or income 

tend to have systematically higher morbidity and mortality rates. 

These health inequalities are one of the main challenges for public health, and there is a great potential for improving

average population health by eliminating or reducing the health disadvantage of lower socioeconomic groups. 

This requires an active engagement of many policy sectors, not only of the public health and health care systems, 

but also of education, social security, working life, city planning, etcetera.

A fruitful dialogue between the public health and health care sector on the one hand, and other policy areas on the 

other hand, is likely to be facilitated if the economic benefits of reducing health inequalities were be made clear. 

It is the purpose of this report to explore the economic implications of health inequalities in the European Union. 

It addresses four specific questions:

- Firstly, how should we conceptualize the ‘economic impact’ of socioeconomic inequalities in health, and how can we measure this? 
 - Secondly, how large are socioeconomic inequalities in health in the European Union, and what is the magnitude of the burden of 
   ill health and premature mortality associated with inequalities in health? 
 - Thirdly, what is the economic impact of socioeconomic inequalities in health in the European Union? And
 - finally, what actions can reasonably be taken to reduce socioeconomic inequalities in health, and what are the potential economic
   benefits of investing in these strategies?

Our conceptual framework is based on the notion that health is both a ‘consumption good’ and a ‘capital good’. As a ‘consumption good’, health directly contributes to an individual’s ‘happiness’ or ‘satisfaction’, and as a ‘capital good’, health is an important component of the value of human beings as means of production. Our analysis has tried to attach a monetary value to the inequalities-related losses to population health in the European Union by combining these two complementary perspectives.

Contents 
 Executive summary 
 1. Introduction 
 2. Framework for assessing the economic implications of socioeconomic inequalities in health 
 3. Estimates of the magnitude of socioeconomic inequalities in morbidity and mortality in Europe
 4. Estimates of the economic costs of socioeconomic inequalities in health in Europe 
 5. Potential economic benefits of policies to reduce socioeconomic inequalities in health 
 6. Preliminary conclusions and evaluation of caveats 
 7. Implications for health policy and for future research and data collection 
 References
 
 Appendices
 A. General overview of socioeconomic inequalities in health in Europe 
 B. Literature review of effects of health on economic outcomes 
 C. The impact of health on economic outcomes: analysis of the European Community Household Panel 
 D. Estimates of the economic impact of health inequalities in the EU-25 in 2004 
 E. Effects of policies to reduce health inequalities: the example of smoking inequalities and tobacco control 

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