Economics of Global Surgical Care

This blog continues its look at the economic perspective of surgical care through the lens of recent literature published from the PGSSC. This week we look at the key economic article from the Lancet Commission on Global Surgery.

Arguably the most overarching look at the economics of global surgical care is Alkire, Shrime, Dare, Vincent, and Meara’s Global economic consequences of selected surgical diseases: a modelling study (2015), Lancet 3(S2):S21-27. This was the lead economic article in the report of the Lancet Commission on Global Surgery (LCoGS), and examined the global macroeconomic impact of the surgical burden of disease. It provides a primer on estimating the macroeconomic consequences of disease, recognizing what is known and applying it in a way that maximizes the robustness of the model while also recognizing what must be assumed and estimated.

The goal of this study was to estimate the economic impact globally – including all countries regardless of income level – of the fraction of the burden of disease that is due to surgical causes. The authors estimated the effect of mortality on the annual global economic output (GDP) during the period from 2015 to 2030, then estimated the effect of surgical disease on total economic welfare during one year, using 2010 for this study. They addressed the problem of defining surgical causes by examining the five disease categories that comprise 85% of all surgical mortality: neoplasm, injury, maternal disorders, neonatal disorders, and digestive disorders. From these categories, they used a survey instrument that produced an estimate of the proportion of each of those categories that required a surgeon for management. From the GBD study, the burden of disease (BoD) secondary to the surgical component of each of these categories was determined.

Economic impact was assessed first by the Value of Lost Output (VLO), which relates mortality due to a disease process to labor supply and capital accumulation over time. This enabled them to estimate the effect of mortality on output in a given year during the interval 2015-2030. Economic impact was then also estimated using the Value of Lost Welfare (VLW), which includes the effect of disease morbidity and encompasses non-market effects through the Value of a Statistical Life (VSL) approach. The uncertainly of the GBD estimates as well as that of the survey instrument provided two-way sensitivity analysis.

Given that the VLO approach included only market losses and only those due to mortality, the economic impact calculated through this method was considerably lower than that of the VLW approach. Table 2 from that paper, which shows the decrease in GDP due to surgical diseases as calculated using the VLO approach, is reproduced below. This indicates a 20.7 trillion dollar loss over 2015-2030, or 1.25% of the projected output over that period.

Using the VLW approach, it was found that for the single year 2010 (recall that the figures above from the VLO approach were over the period 2015-2030), losses were equivalent to 17% of GDP, or 14.5 trillion USD. The losses by disease category and by mortality and morbidity are shown in table 3 of that paper, which is reproduced below. The point is made that the VLW approach is an assessment of economic welfare, which includes non-market factors such as how good health is valued in and of itself, and therefore can only be expressed relative to GDP rather than actual losses in GDP.

Of significance is that there was a large difference among the losses by category between higher income countries and LMICs. In HICs, 96% of all surgically-related economic losses were due to neoplasm and injury. In low income countries (LICs), where there are major problems with access to basic maternal care, maternal, neonatal, and digestive disorders comprised 26% of total losses. For LMICs, this figure was 14%. This contrast was true regardless of method used for the analysis. Further stratification showed that maternal and neonatal disorders comprised 10% of the loss in GDP in central sub-Saharan Africa and only 0.5% in western Europe. This corroborates the point made in the discussion of this article that the greatest impact of unaddressed surgical burden of disease is on the most vulnerable populations. The practical message from this information is that a large part of the surgical burden of disease is avertable.

In addition to the specific methods and findings of this paper, it is highly recommended that the discussion section and the references throughout be examined closely. This provides a summary of economic modeling methodology, the differences in perspective of approaches to the macroeconomic effects, the pitfalls, limitations, necessary assumptions, and the importance to the findings of the model of how those assumptions are made.