U.S. Federal and State Medicaid Budgetary Impact of Adult Visual Disorders: 2004
Rein, D. B., Wirth, K., Hoerger, T. J., & McCall, N. (2005, December). U.S. Federal and State Medicaid Budgetary Impact of Adult Visual Disorders: 2004. Presented at American Public Health Association Annual Meeting, Philadelphia, PA.
Context: In 2004, over 3.4 million Americans were visually impaired or blind, and millions more experienced serious eye diseases or refractive error. These patients generated substantial medical and other costs, a portion of which is borne by the federal government and State Medicaid Programs. Objective: To estimate the costs paid by the federal government and State Medicaid for patients over age 40 with visual impairment, blindness, refractive error, age-related macular degeneration, cataracts, diabetic retinopathy, and primary open-angle glaucoma. Methods: We defined government costs as income assistance payments, tax losses, and medical and long term care costs paid by taxpayers for patients with adult visual disorders. The cost of income assistance programs was estimated as the sum of Supplemental Security Income (SSI), Food Stamps, and Social Security Disability Insurance (SSDI) payments received by individuals eligible for benefits due to their vision. We also estimated the cost of government sponsored rehab and education programs as part of this category. Tax losses were estimated based on estimates of lower labor force participation and earnings due to visual impairment and blindness, as well as additional tax losses generated by standard income-tax deduction for the blind. We estimated the total direct medical and long term care costs of adult visual disorders and then calculated the government share of these costs. The government share of direct medical costs was estimated by assuming that Medicare paid for all the nonprescription medical costs for individuals over age 65, and that Medicaid paid an estimated portion of the costs of those aged 40 to 64. We estimated government share of long term care costs by multiplying our estimate of visual disorder attributable long term care costs by the proportion of all long term care costs paid by Medicaid (50.6 percent) and Medicare (10 percent) respectively. We assumed all Medicaid costs were shared equally between the federal and state governments. Results: The total 2004 federal and Medicaid budgetary impact of adult visual disorders was $13.66 billion, of which the federal government paid $10.79 billion and State Medicaid programs paid $2.88 billion. Income assistance and tax losses accounted for $1.55 billion of the budgetary impact, direct medical costs accounted for $5.47 billion, and other direct costs accounted for $6.65 billion. Conclusions: Adult visual disorders impose a substantial financial burden on the federal government and state Medicaid. The largest component of these costs is the expense of additional long term residential care attributable to visual loss and blindness, followed by medical costs, and income assistance. Given this high annual budgetary impact, public health interventions or medical technologies that prevent or cure vision loss and blindness have the potential to result in substantial financial savings to US taxpayers.