Transcript - Partnerships in Prevention Science Institute

Prevention’s Cost Effectiveness―
Illustrative Economic Benefits of General
Population Interventions
Richard Spoth and Max Guyll
Partnerships in Prevention Science Institute
and Department of Psychology
Iowa State University
United Nations Office on Drugs and Crime
Technical Seminar on Drug Addiction Prevention
and Treatment: From Research to Practice
December 16, 2008
Potential Economic Benefits of Prevention
• Preventive interventions most likely to be
economically beneficial when...

Prevented condition is prevalent

Condition is costly

Effective preventive interventions are available

Interventions costs are low
Prevention Spending is an Investment
• Prevention costs spent in the present for benefits
returned in future
• Intervention costs and effects are known
• Benefits must be estimated across the future,
discounted to determine value in present
Return on Investment
(Benefit-cost ratios) of Selected Programs*
• Pre-school education

Early Childhood Education.........................................$2.36
• Child welfare

Nurse Family Partnership...........................................$2.88
• Youth development

Guiding Good Choices (PDFY)...............................$11.07
• Juvenile offender programs

Dialectical behavior therapy....................................$38.05
*Source: Aos, Lieb, Mayfield, Miller & Pennucci (2004)
Economic Benefits of
Substance-Use Prevention in General
• Prevention benefits

Increased productivity, tax
revenues

Lower health care costs

Reduced justice system costs

Decreased welfare, victim, fire
costs
• Potential benefits are greatest where
current costs of prevented condition
are greatest
Rationale for Illustrative
Economic Analyses of Substance
Prevention (Alcohol/Meth)*
• Prevention with general populations could save billions
• In U.S., annual alcohol costs estimated at $228.5 billion
for adults, $89.5 billion for youth
• Annual drug costs estimated at $151.3 billion
• Employee methamphetamine use cost to employers
estimated at $31.8 billion per year
• Economic analyses assist in estimating value of
interventions and identifying interventions that hold
most promise
*Using most recent estimates and adjusting for inflation to current year.
*Case Study of “Billy” or “Betty”:
Costs of Life Trajectory of Early Substance
Use and Problem Behaviors
Level of Problem Behaviors
Resident home expenses
Medicaid
Special education
State hospital
Legal (estimated)
Total
Early Childhood
$50,000
$110,000
$28,000
$128,000
$20,000
$336,000
Young Adulthood
*Illustrative case history and cost projections from Dennis Embry (PAXIS Institute).
Future Annual Benefits
from Preventing a Single Alcohol Use Disorder
7000
6000
5000
4000
3000
2000
1000
0
18
26
34
42
50
Years of age
58
66
74
Cost-effectiveness (CE) vs. Cost-benefit (CB)
• CE yields cost to achieve a particular outcome—such
as prevention of an alcohol-use disorder
• Cost to produce a unit of prevention
Prevention Cost
• CE = Prevention
Effect
Cost-effectiveness (CE) vs. Cost-benefit (CB)
• CB assesses whether savings generated by prevention are
greater than costs spent on prevention

Important when monetary resources are limited
Assists policy/decision-makers in choice of which
intervention to fund
• CB = Benefit of Prevention Effect (Cost Savings)
Cost per each Prevention Effect

Empirical Examples
Longitudinal randomized intervention-control
prevention trials
• Project Family Randomized Controlled Trial


667 families recruited through 33 Iowa school districts
Example: Iowa Strengthening Families Program (ISFP) for
general populations (universal intervention)
• Capable Families and Youth Trial


679 families recruited through 36 rural Iowa school districts
Example: Life Skills Training Program (LST) for general
populations (school-based)
Estimates of Costs
• Illustrative cost categories (for family program)
 Program facilitation (38%)
 Facilitator training (30%)
 Incentives and child care (21%)
 Site administration (6%)
 Materials (3%)
• Total ISFP cost = $68,856 per 100 families
• Total LST cost = $15,500 per 100 students
Sources: Spoth, R., Guyll, M., & Day, S. X. (2002). Universal family-focused interventions in alcohol-use disorder
prevention: Cost-effectiveness and cost-benefit analyses of two interventions. Journal of Studies on Alcohol, 63(2),
219-228; Guyll, Spoth, & Madon (2008). Economic analysis of prevention effects on methamphetamine use: An
employer’s perspective. Unpublished manuscript.
Cost-effectiveness-Final Calculations
Prevention cost
Prevention effect
For alcohol (ISFP case):
Cost of $68,856 per 100
=
≈5.5 cases prevented per 100*
=
$12,459 cost per disorder prevented
Meth use (LST): $15,500/≈3.2 cases* = $4,921 per meth
use case prevented
*Difference between control and intervention group cases
Savings for Each Unit of Prevention
• ISFP Case
 Benefit per alcohol disorder prevented
─
─
$244,288 (Before discounting)
$119,633 (After discounting)
• LST Case
 Employer benefit per meth user prevented
─
─
$402,961 (Before discounting)
$130,013 (After discounting)
Benefit-Cost Ratios Across Two Studies
Alcohol
Disorder
(ISFP)
Past Year
Meth Use
(LST)
Prevention benefit
$119,633
$130,013
Cost per each prevention effect
$12,459
$ 4,921
$9.60
$9.98
Benefit-cost ratio (reference case)
Conclusions
• Evidence that prevention more than pays for itself (e.g., $10
returns/dollar invested)
• Illustrative analyses were relatively conservative
 Conservative estimates of interventions level of efficacy
(e.g., intent-to-treat)
 Considered only costs avoided by prevention of one type of
outcome; in fact multiple cost-saving outcomes produced
 Did not include estimate of societal “willingness to pay” to
prevent each alcohol-use disorder
• Effective and efficient prevention promises to save, possibly,
billions of dollars per year, provided we can learn how to
effectively implement on a larger scale...
Acknowledgement of
Our Partners in Research
Investigators/Collaborators
R. Spoth (Director), C. Redmond & C. Shin (Associate Directors),
T. Backer, K. Bierman, G. Botvin, G. Brody, S. Clair,
T. Dishion, M. Greenberg, D. Hawkins,
K. Kavanagh, K. Kumpfer, C. Mincemoyer,
V. Molgaard, V. Murry, D. Perkins, J. A. Stout
Associated Faculty/Scientists
K. Azevedo, J. Epstein, M. Feinberg, K. Griffin,
M. Guyll, K. Haggerty, S. Huck, R. Kosterman,
C. Lillehoj, S. Madon, A. Mason, J. Melby, M. Michaels,
T. Nichols, K. Randall, L. Schainker,
T. Tsushima, L. Trudeau, J. Welsh, S. Yoo
Prevention Coordinators
E. Berrena, M. Bode, B. Bumbarger, E. Hanlon
K. James, J. Meek, A. Santiago, C. Orrson
Welcome to our website...
www.ppsi.iastate.edu