Recent laws instituted in the United States substantially cut funding to many government programs, especially those related to health or social well-being.
As a health economist, Dennis Scanlon, distinguished professor of health policy and administration at Penn State, studies the financial impact of health-related investments. He said all levels of government in the United States should track the costs and cost-savings of programs that affect people’s health so government agencies and taxpayers can fully understand the true benefits and costs.
Scanlon spoke about the value of tracking the financial impact of investments in these factors, which are known as the social determinants of health.
Q: What are social determinants of health?
Scanlon: When people think about spending on their health, they often think about health care, including hospitals, insurance, medical equipment, medicines and medical staff. In the United States, health care costs an average of $14,000 per person per year and accounts for more than 17% of the nation’s total Gross Domestic Product (GDP).
Despite this massive investment, access to quality health care explains about 20% of whether someone is healthy, according to experts. These other factors outside of health care that affect people’s health — socioeconomic factors, the physical environment and health behaviors — are referred to as social determinants of health.
Socioeconomic factors include education, income and familial support. Many aspects of the physical environment can affect health, including how much pollution a person faces in their home or at work, how close they live to health care facilities and the safety of their neighborhood. Health behaviors include eating, drinking, sleeping, smoking and sexual activity.
These factors help determine how healthy a person is, but as a society, when we invest in health, some analysts believe the United States invests too much in health care and not enough in other health enhancing "social determinants" such as support for housing, food and transportation.
Q: How do socioeconomic factors, the physical environment and health behaviors affect human health?
Scanlon: The impact of behavior on health is widely acknowledged. For example, people generally accept that what you eat or how much you sleep affects your health. Evidence backs this up; research has demonstrated that insufficient sleep and poor diet are both associated with poor mental health, heart disease and diabetes.
Socioeconomic factors can influence health in a number of ways that are both obvious and, at times, less obvious. Does someone make enough money to raise their child in a house without peeling lead paint? Do they have reliable access to food? Research has repeatedly shown that worrying about where your next meal will come from is bad for your health, even if you never go hungry. Does someone have enough money to live where it is safe to go outside for exercise or play?
The physical environment also has a pretty clear influence on your health. Before humans had basic sanitation controls for garbage, pest control and sewage, life spans were much shorter. The bubonic plague wiped out one third of the population of Europe in the 1300s, and it was spread from rats to humans by fleas. Today in the United States many people do not live in regular contact with rats and fleas, but some people still do.
Q: Why study the social determinants of health together? Why not focus on whichever problem seems important at the moment?
Scanlon: A health economics perspective is really useful for answering this question because it considers the tradeoffs that are explicitly made in spending decisions, or what economists would call the opportunity costs.
At local, state and federal levels, the government operates a wide variety of programs to address the social determinants of health. For example, to ensure that people have adequate access to food, the United States operates the Supplemental Nutrition Assistance Program (SNAP), while school districts and cities operate food banks and other programs to support food security. Meanwhile, other programs like those run by the Federal Department of Housing and Urban Development (HUD) — address issues of housing access and so on.
All these programs have different funding streams, and they may affect multiple aspects of a person’s health, but they are not evaluated in a uniform way. Their full downstream impact is not understood.
If we look at these programs as investments, the government oftentimes does not analyze the full return-on-investment in the way a business might. The economic cost is not connected to the impact on the health of people and populations. Then in turn, the impact on health is not connected to what we spend on doctors, medicines and hospitals.
Q: What would an investment approach to government spending look like?
Scanlon: Let’s consider government investment in a potentially divisive program — SNAP. Despite local studies of SNAP’s return-on-investment, there is no system-wide data that can reveal — for example — the effect that funding SNAP at a given level this year would have on Medicaid spending 10, 20 or 30 years in the future. Similarly, we lack the data to accurately explain how investing in SNAP would affect spending on the Children’s Health Insurance Program or schooling — which might be affected if children are hungry and unable to learn.
Investments in one area may affect another area, but because these programs operate out of different agencies and governmental entities, the dots are not connected. And if we don’t connect the dots, we don’t understand the true impact.
When you are talking about 17% of GDP, even small differences in return on investment can make a huge difference in the expenditure of tax money and in people’s health.
Q: Should the U.S. invest in health for individuals or for the entire population?
Scanlon: This is a question that people will answer differently depending on their personal values and political ideology.
Some people feel strongly that an individual’s health should be up to that person; invest in your health or not, but don't look to society for help. Some people believe society should raise all boats and invest in the well-being of all people. And some think you have to combine individual responsibility with some degree of broader social support.
For a long time in this nation, there has been some combination of individual and population-level health support. For example, when the Environmental Protection Agency banned lead from gasoline and paint, all of society benefited. In the 1980s, almost all children in the U.S. had elevated levels of lead in their blood, and today that number is well below 10%. On the other hand, the U.S. has individual health insurance, often tied to employment, and this is a very individualistic approach to supporting health as we still have about 25 million Americans lacking health insurance.
Gathering the right data can help the nation reduce government spending by eliminating waste, fraud and ineffective spending while highlighting which programs are effective and deserving of support.
Q: How can we, as a society, better address and understand the social determinants of health?
Scanlon: The multiple levels of government and different agencies within them operate in silos. We need to gather data across these silos to make sure we understand the downstream impacts of all programs from the same perspective — to make sure that we understand the true return on investment we get from any investment of tax dollars we make.
We don’t know enough about how HUD and SNAP and Medicaid are all related to each other, and we need to know that to most accurately understand the way that these programs may decrease or increase spending on other programs and affect the overall investment of tax dollars.
A big part of understanding these relationships is getting a better handle on where the evidence is and what it can tell us. Then, we have to use that data to make informed decisions. Otherwise, we will be basing decisions on anecdotes and rhetoric rather than on evidence, and I do not think people of any political ideology want that.