Economic costs of chronic disease through lost productive life years (PLYs) among Australians aged 45–64 years from 2015 to 2030: results from a microsimulation model

OBJECTIVES: To project the number of older workers with lost productive life years (PLYs) due to chronic disease and resultant lost income; and lost taxes and increased welfare payments from 2015 to 2030. DESIGN, SETTING AND PARTICIPANTS: Using a microsimulation model, Health&WealthMOD2030, the costs of chronic disease in Australians aged 45–64 were projected to 2030. The model integrates household survey data from the Australian Bureau of Statistics Surveys of Disability, Ageing and Carers (SDACs) 2003 and 2009, output from long-standing microsimulation models (STINMOD (Static Incomes Model) and APPSIM (Australian Population and Policy Simulation Model)) used by various government departments, population and labour force growth data from Treasury, and disease trends data from the Australian Burden of Disease and Injury Study (2003). Respondents aged 45–64 years in the SDACs 2003 and 2009 formed the base population. MAIN OUTCOME MEASURES: Lost PLYs due to chronic disease; resultant lost income, lost taxes and increased welfare payments in 2015, 2020, 2025 and 2030. RESULTS: We projected 380 000 (6.4%) people aged 45–64 years with lost PLYs in 2015, increasing to 462 000 (6.5%) in 2030—a 22% increase in absolute numbers. Those with lost PLYs experience the largest reduction in income than any other group in each year compared to those employed full time without a chronic disease, and this income gap widens over time. The total economic loss due to lost PLYs consisted of lost income modelled at $A12.6 billion in 2015, increasing to $A20.5 billion in 2030—a 62.7% increase. Additional costs to the government consisted of increased welfare payments at $A6.2 billion in 2015, increasing to $A7.3 billion in 2030—a 17.7% increase; and a loss of $A3.1 billion in taxes in 2015, increasing to $A4.7 billion in 2030—a growth of 51.6%. CONCLUSIONS: There is a need for greater investment in effective preventive health interventions which improve workers’ health and work capacity.