Environmental Protection Agency Underestimating Health Costs Tied to Air Pollution by as Much as 40%, According to Analysis Group Study in Health Affairs

BOSTON, Dec. 7, 2020 /PRNewswire/ -- Today, Health Affairs published a report written by economists from Analysis Group, one of the largest international economics consulting firms, suggesting that the Environmental Protection Agency's (EPA's) Environmental Benefits Mapping and Analysis Program–Community Edition (BenMAP-CE) tool underestimates health care costs related to air pollution by as much as 40%. As a foundational tool for policymakers, updating the methodology to reflect the full range of air pollution-induced health care costs would allow for more informed decision making, the authors concluded.

The Analysis Group research team analyzed data for treatment of respiratory and cardiovascular issues, which are the conditions associated with air pollution that are tracked by the BenMAP-CE tool. "The problem with BenMAP-CE is that, in its default configuration, it only tallies the costs of hospital and emergency department admissions directly attributable to respiratory and cardiovascular conditions," said Analysis Group Senior Advisor Howard Birnbaum, the study's lead author. "It entirely misses costs attributable to physician and clinic visits, prescription drugs, supplies, and home health care, among other things. Approaches to estimating the health care costs of air pollution, such as the model used by the EPA, need to be updated so that the policies relying on them accurately reflect the reality of the real health care cost of air pollution. These costs continue to increase along with air pollution levels and their omission directly affects lives in countless ways."

To understand the extent of the shortfall, the Analysis Group economists, led by Dr. Birnbaum and Manager Urvi Desai, studied the health care resources used and the related costs for a set of patients who were hospitalized for respiratory or cardiovascular issues in 2016. Those data were compared to health care costs associated with the same set of patients in 2015, when none of the patients had been hospitalized for these conditions. By comparing the total costs for health care provided in the year of hospitalization to costs from the previous year, the team was able to identify additional costs associated with treatment for respiratory and cardiovascular conditions. The researchers found that the extent and cost of this additional care was substantial.

BenMAP-CE is often used in the US to conduct various types of analyses in support of air quality regulations, such as the Regulatory Impact Analysis for Light-Duty Vehicle Greenhouse Gas Emission Standards and the Regulatory Impact Analysis for the Final Mercury and Air Toxics Standards. The study's results suggest that policy analyses using the BenMAP-CE model substantially underestimate the health care benefits of reductions in air pollution. Further research is warranted on the full range of air pollution–induced health care costs and could consider temporal factors, such as recent increases in air pollution associated with changes in climate and outbreaks of new diseases, such as COVID-19.  

The study, Measuring The Impact Of Air Pollution On Health Care Costs, was an independent project of Analysis Group without funding from, or affiliation with, any third party, and can be found in the December issue of Health Affairs.

About Analysis Group:

Analysis Group is one of the largest international economics consulting firms, with more than 1,000 professionals across 14 offices in North America, Europe, and Asia. Since 1981, we have provided expertise in economics, finance, health care analytics, and strategy to top law firms, Fortune Global 500 companies, and government agencies worldwide. Our internal experts, together with our network of affiliated experts from academia, industry, and government, offer our clients exceptional breadth and depth of expertise.  To learn more about Analysis Group's capabilities, visit AnalysisGroup.com.

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