Maximizing Healthy Life Years: Investments that Pay Off
- January 22, 2015 World Economic Forum
In times of economic uncertainty and slow growth, it is more important than ever for economies to find alternative ways to gain a competitive advantage. Healthy individuals and healthy populations can create a competitive advantage through increased productivity, reduced healthcare costs and overall higher levels of well-being.
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Non-communicable diseases (NCDs) are a key threat to a population’s health and therefore to its economic growth. The negative effect of these chronic diseases is undeniable. An unhealthy population is expensive − for governments, for businesses, for communities and for individuals. Globally, $47 trillion of cumulative output will be lost between 2012 and 2030 because of the impact of NCDs and mental disorders (World Economic Forum and Harvard School of Public Health, 2011).
The ecosystem of health is complex, but also full of opportunities for bringing populations to healthier states and realizing the respective socio-economic gains that this will deliver. Investments in the primary prevention of NCDs, built on robust primary healthcare infrastructure and efforts to maximize “healthy life years”, will bring positive health and economic returns. For example, Singapore’s Health Promotion Board subsidizes healthier cooking oil for use in meals outside the home, a move which is expected to reduce the number of cases of coronary heart disease by 2020 and generate a return on investment (ROI) of 1100%. Meanwhile, Columbia University has estimated that China could generate a 90% ROI by implementing air and water protection mechanisms to reduce the health effects of pollution. Investments at the right inflection point in the life cycle involving stakeholders from across diverse sectors can generate superior economic returns, thereby justifying the investment.
Public and private stakeholders can realize a return from investing towards healthier populations. Various methodologies are available to quantify the benefits and returns of a healthy population and all have their advantages and disadvantages. Understanding what businesses, governments and societies at large have to gain from investing in health requires an approach that assesses full societal costs and full societal benefits of healthy populations.
The concept of maximizing healthy life years to assess the link between healthy populations and economic growth can provide a pragmatic approach to assessing the full range of costs and benefits societies face. By living healthier lives, communities nurture “virtuous cycles of health” – recurring cycles of events, with the result of each one increasing the beneficial effect of the next − that fuel both health and growth.
This report, part of the “Future of Healthy” project, includes:
- A systems map depicting the complex ecosystem influencing healthy populations
- Key inflection points for investment in healthier societies, extracted from an analysis of the systems map
- Examples of investments at these inflection points that have resulted in positive health and economic returns
- Building blocks to rethink the concept of ROI for a healthy population
The report stresses the need for a new way of thinking about the ROI of healthy populations. The ROI can be regarded from an individual perspective (iROI) as well as from a population/societal perspective (pROI). It is critical to bring all relevant stakeholders together to create a common understanding of the value of healthy populations in order to attract private and public investment. Increased investment in health will also come from a common understanding of sustainable business models that can be used to share the positive returns from healthy populations and of the roles of each party in driving these models.