Diabetes Impacts Financial Health Over and Above Medical Expenses

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According to some estimates, a person with diabetes spends over $4,000 more a year in medical expenses than those without the condition. However, the financial hits do not end there. A new study quantifies the non-medical costs of the disease, which includes lower lifetime earnings and fewer job prospects than their healthy peers.

In the journal Health Affairs, Dr. Michael Richards, a physician and doctoral candidate in the department of health policy and administration at Yale University, documents the findings of the National Longitudinal Study of Adolescent Health which tracked 15,000 people over a period of 14 years, from middle school into their early 30’s. Those with diabetes had lower rates of finishing high school (6% dropout rate) and were less likely to attend college than those young adults who were not diabetic. By the age of 30, a diabetic person was 10% less likely to have a job, in part because of the reduced level of education.

For those with jobs, people with diabetes earned about $1,500 to $6,000 less per year, which could ultimately translate into $160,000 less over the course of their lifetimes.

There could be many factors involved in this unfortunate situation. Although the study did not distinguish between Type 1 and Type 2 diabetes, the second type is more common and is closely linked to obesity and inactivity. Previous studies have cited obesity as an obstacle to obtaining and keeping good jobs. Some note that obesity discrimination continues to exist, and that some employers hesitate to hire those with chronic diseases because of a fear of lower productivity or greater health insurance burden.

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People with diabetes themselves may also be reluctant to seek out better-paying jobs for fear of losing health benefits, a phenomenon known as job lock.

Unfortunately, the financial effect of diabetes also appears to affect future generations. Young healthy people whose parents were diabetic were 6% less likely to attend college. Dr. Richards says that this may be due to having fewer financial resources and less time and energy to devote to their children because of the difficulties of managing the disease.

“It’s a novel and intriguing finding,” he said, “and if it is indeed a real phenomenon, then it suggests that the societal burden of diabetes has perhaps been underestimated.”

Diabetes afflicts 25.8 million people in the United States and costs as much as $200 billion a year to manage. In 2010, nearly two million new cases were diagnosed in people as young as 20 years old.

Source References:
Fletcher JM, Richards MR, “Diabetes’s ‘Health Shock’ To Schooling And Earnings: Increased Dropout Rates And Lower Wages And Employment In Young Adults” Health Affairs January 2012 31:127-34; doi:10.1377/hlthaff.2011.0862
American Diabetes Association, “Economic Costs of Diabetes in the U.S. in 2007” Diabetes Care March 2008 31:596-615; doi:10.2337/dc08-9017

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