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Economic Gains from Healthier Choices

The Economic Gains from Healthier Choices for Missouri Counties (EG-HC) Excel tool is ready for you to use with your HLI community. Links are provided below to information on the development of the tool and how you can use the tool to show the economic gain from your HLI efforts to promote and support healthier lifestyle choices in your community.

The EG-HC is an easy-to-use tool to show cumulative economic gain, by county, for selected percentages, ranging from 5 to 50%, of the county population for the following changes:

G. Dean Crader of the Economic & Policy Analysis Research Center (EPARC) at the University of Missouri developed the tool for the Healthy Lifestyle Initiative. The tool is based on an economic model by Kevin M. Murphy and Robert H. Topel within their paper, “The Value of Health and Longevity” (NBER Working Paper 11405, 2005).

The original model by Murphy and Topel measured the economic growth in the United States attributable to major medical advancements during the last century. As well, they projected economic gains for future medical advancements. These economic gains were calculated from agents’ willingness to pay for medical advancements that increased longevity as well as quality of life. Within their model, these economic gains were then aggregated across the entire population of the United States because it was assumed that medical advancements are available to everyone in society.

The calculated economic gains within the HLI EG-HC Excel tool use only the portion of Murphy and Topel’s model that pertain to increased longevity. Appropriately, for the Healthy Lifestyle Initiative purposes, the aggregation of these gains is limited to those residents within Missouri counties that choose to improve their health and longevity by their own means and not through medical advancement. We assume the value of choosing a healthier lifestyle using preventative health care is equivalent to their willingness to pay for similar longevity-increasing medical advancements.

Tammy Gillespie, who is assisting Lynda Johnson in the evaluation of the Lafayette County Live Healthy, Live Well efforts, is reviewing how they can use the tool to identify potential, county-level savings if health improvements are implemented. Please let us know your ideas and plans to use the tool. If you have any questions, please contact Dean Crader at craderg@missouri.edu.

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