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The Impact of Immunization on Economic Development
While immunization is first and foremost a public health issue, its benefits also have a direct bearing on socio-economic development. The economic benefits of immunization programs can be measured in two different ways. First, there is a link between health and wealth, namely, the positive impact of higher life expectancy on a country’s economic growth. Second, immunization has proved to be very cost-effective compared with other health interventions and as a way to save money - over time - for both individuals and national governments.
Improved Life Expectancy Increases Economic Growth and Development
- Every healthy child who survives contributes to a country’s increased economic productivity, not merely by virtue of their longer lives, but also because they become better students and more productive workers. Their good health also frees their parents and families to fulfill their roles in society.
- Vaccines improve labor productivity by preventing life-long disabilities and death. For example, cost-effective vaccines against poliomyelitis, measles, diphtheria, tetanus and pertussis, available through the World Health Organization (WHO) and the United Nations Children’s Fund (UNICEF), have been estimated to prevent yearly up to 3 million deaths and 750,000 cases of blindness, mental or physical disabilities in children.(1)
- WHO data from Latin American and Caribbean countries indicate that growth in gross domestic product (GDP) is statistically associated with life expectancy. The results suggest that for every additional year of life expectancy there will be an additional one percent increase in GDP 15 years later.(2) Also, life expectancy at birth alone is one of the strongest indicators of growth in GDP.
- Education and health are two key components of a country’s development. The economic benefits of investing in health and education contribute to growth and the reduction of poverty.(3) Immunization contributes both to the health of the population and to the ability of children to take advantage of educational opportunities. Its preventive value also frees healthcare funds enabling larger investments to be made in education.
- Child survival helps slow the rate of population growth. Research has shown that the transition from large to small families in developing countries is preceded by a decline in childhood mortality. Parents may not feel the need to have as many children if they have less fear that a substantial number of their offspring will not survive to adulthood. Slowing population growth is important because it can contribute to a more rapid growth in per capita standard of living.(4)
Immunization is More Cost-Effective than Other Health Interventions, Saving Individuals and Governments Money
- Immunization is one of the world’s most cost-effective health interventions. By preventing disease, it allows countries to reduce the amount of money spent on treatment and hospitalization costs. It helps national governments avoid the expense of treating major outbreaks of debilitating and crippling diseases and the loss of productivity that accompanies these illnesses. It also increases productivity by allowing parents to work instead of staying home to care for sick children. Better adult health directly affects productivity by increasing work output and reducing absenteeism.(2)
- Immunization is the world’s greatest health bargain. It costs just US$17 to immunize a child with the six core Expanded Programme on Immunization (EPI) vaccines (polio, diphtheria, pertussis, measles, tetanus and tuberculosis), including all costs of delivery. Most immunizations cost less than US$50 per healthy life year saved. This is compared to the cost of treating a disease such as hypertension, which is estimated in the United States to be between US$4,340 and US$87,940 per healthy life year saved.(5) In some settings, countries can save as much as US$29 for every dollar spent on immunization with the six core EPI vaccines.(3)
- The worldwide interruption of the transmission of the wild poliovirus is targeted to be achieved by the end of the year 2000. If no transmission of the virus subsequently occurs and the worldwide eradication of polio is confirmed (target date 2005), WHO estimates that the governments of the world will save an estimated US$1.5 billion in vaccine, treatment and rehabilitation costs every year. Of this amount, Western European countries would save US$200 million a year (just for vaccine and immunization related expenses), and the savings for the United States would amount to US$230 million a year.
- The entire cost of smallpox eradication, achieved in 1979, was US$25 million per year for 12 years, while the cost of vaccination, quarantine and treatment in a single year at its start was over US$300 million. Thus, there were savings of approximately $275 million per year in direct measurable costs.(6)
- The rationale for investing in immunization programs in developing countries is clear: such programs represent a wise investment in human capital development, are low-risk investments with a proven track record of impact, are highly cost effective, have significant economies of scale that lead to low unit costs and can be financially sustained by developing countries.(7)
- New vaccines have been rejected by many governments in low-income countries because of their cost. Analysis shows that some of these newer vaccines could be highly cost-effective in low-income countries where disease burdens are high. A health intervention is deemed as cost effective if it costs less than a country’s average per-capita gross national product (GNP) for each year of healthy life that it buys.(8) Some examples of cost-effective vaccines are:
- The Hepatitis B vaccinecould save up to 900,000 lives per year and would cost between US$8 and US$11 for each year of healthy life it buys in low-income countries with high prevalence.(9)
- A vaccine against Haemophilus influenzae type b (Hib), a bacterial infection which causes meningitis and pneumonia, would cost around US$21-22 per year of healthy life saved in most low-income African countries.(6)
SOURCES
1 World Health Organization Report on Infectious Diseases: Removing Obstacles to Healthy Development, 1999
2 WHO World Health Report, 1999: Making a Difference
3 The World Bank website, URL: http://www.worldbank.org/html/extdr/hnp/health/ppi/p1devs.htm
4 USAID website, URL: http://www.info.usaid.gov/pop_health/cs/csinvest.htm
5 Cost-effectiveness of intensive treatment of hypertension. Based on presentations by Donald S. Shepard, PhD; and Dominic Hodgkin, PhD; Am J Manag Care 1998 Dec 1904; discussion S770
6 Miller 1998
7 Asian Development Bank, Sustaining Effective Social Programs; Financing Immunization in Cambodia, Lao PDR and Viet Nam
8 A "year of healthy life" is equivalent to a year without the burden of disease or premature death. The term is used to explain disease burden as measured by the DALY or disability adjusted life year. A DALY measures both fatal and nonfatal disease burden and is the sum of years of life lost from premature death and years lived with a disability. One DALY equals one lost year of healthy life.
9 Miller, McCann 2000
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Background materials
GAVI: Questions and Answers
Fact sheets
About GAVI
Immunization facts and figures
The impact of immunization on economic development
Vaccine-preventable diseases: an overview
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