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TABLE 2.- TOTAL NUMBER OF PERSONS INJURED AND RATES PER 100 PERSONS, BY AGE, SEX AND CLASS OF
1 Figure does not meet standards of reliability or precision.
TABLE 3.—TOTAL ECONOMIC COST: ESTIMATED DIRECT EXPENDITURES, INDIRECT COSTS OF MORBIDITY, AND PRESENT VALUE OF LIFETIME EARNINGS DISCOUNTED AT 6 AND 8 PERCENT, BY CLASS OF ACCIDENT, 1968
METHODOLOGY The economic cost to the Nation of accidents is measured in terms of morbidity and mortality costs. Morbidity is comprised of direct costs-expenditures for medical care and treatment of accident victims—and indirect costs-losses in earnings resulting from work-loss due to accidents and the imputed value of services of housewives injured in accidents and prevented from housekeeping. Mortality costs represent the present value of expected lifetime earnings of persons who died from accidents. Morbidity
Direct costs.-The direct costs of accidents represent expenditures for hospi. tal care; physicians' services; and other personal health care services such as professional services, i.e., nurses, physical and occupational therapists, home health services, nursing home care, drugs and medical supplies, etc.
Amounts for each of the major components of expenditures for accident victims were estimated and then distributed by class of accident. The following describes this estimating procedure:
1. Hospital Care a. Unpublished data were provided by the National Center for Health Statistics from the National Health Survey on the number of days of hospital care for accident victims in fiscal year 1966, by class of accident. The number of days of care were increased approximately 2.5 percent, the percentage increase in the noninstitutional population from January 1, 1966 to July 1, 1968, to yield the following days of care for 1968:
Class of accidents and total days of care
9, 280 Other
4,721 b. The average cost per patient day in 1968 for short-term non-Federal general hospitals was $61.38. (Source: American Hospital Association, "Guide Issue," Hospitals, August 1969.)
Application of the $61.38 to total days of care yields the following estimated hospital care expenditures in 1968 for accident victims :
Class of accident and hospital care expenditures
---- $1, 731
280 -------------------Home -----Other
290 2. Physicians' Services a. The total number of physicians' visits in 1968 was 1,343 million. Visits for accidents amounted to 99,686 or 7.4 percent of the total. (Source : National Disease and Therapeutic Index.)
b. Total expenditures for physicians' services in 1968 were $11,562 million. (Source : Rice, Dorothy P. and Cooper, Barbara S., "National Health Expenditures, 1929-68." Social Security Bulletin, January 1970.)
C. Assuming expenditures for physicians' services are distributed the same as physicians' visits, these expenditures for accident victims totaled $856 million (.074 X $11,562 million).
d. Assuming expenditures for physicians' services for accident victims have the same distribution by class of accident as hospital days, expenditures are as follows:
Class of accident and expenditures for physicians' services
[In millions] Total ---
293 139 281 143
3. Other Personal Health Care Services and Supplies
a. Total expenditures for hospital care and physicians' services in 1968 amounted to $32,313 million. (Source: Rice and Cooper, “National Health Expenditures, 1929-68," op cit.)
b. Expenditures for hospital care and physicians' services for accident victims were $2,587 million or 8 percent of the total.
c. Total expenditures for all other personal health care services in 1968 were $17,582 million.
d. Application of the 8 percent to all other personal health care expenditures results in a total of $1,407 million, the estimated amount of other personal health care expenditures for accident victims.
e. Applying the distribution of hospital days by class of accident, expenditures for other personal health care services and supplies are as follows:
Class of accident and other personal health care expenditures
---- $1, 407
Motor vehicle -----
235 The sum of these three major components of care yields a total $3,994 million for the care and treatment of accident victims. Table A summarizes the direct costs by type of care and class of accident.
TABLE A.-DIRECT COSTS: ESTIMATED EXPENDITURES FOR HOSPITAL CARE, PHYSICIANS' SERVICES, AND OTHER PERSONAL HEALTH CARE SERVICES AND SUPPLIES, BY CLASS OF ACCIDENT, 1968
Indirect morbidity costs are measured for both the labor force and housewives. The following outlines the estimating procedure for these two population groups :
1. Labor Force The National Health Survey reported an annual total of about 10 million days lost from work during the period July 1965-June 1967. The assumption was made that work-loss days did not change substantially from this period to 1968. These data are available by class or accident in broad age groups for men and women, as shown on table B. Work-loss days were divided by 245, the approximate number of working days during the year, to obtain man-years lost. Average annual earnings, by age and sex, were then applied to compute total indirect losses for those in the labor force who were prevented from working because of accidents.
TABLE B.-AVERAGE ANNUAL NUMBER OF WORK-LOSS DAYS DUE TO INJURIES, BY AGE, SEX, AND CLASS OF
ACCIDENT, JULY 1965-JUNE 1967
1 The sum of data for the 4 classes of accidents may be greater than the total because the classes are not mutually exclusive.
2 Figure does not meet standards of reliability or precision.
Source: National Center for Health Statistics, unpublished data based on household interviews of the civilian, nonInstitutional population.
Average annual earnings (wages and salaries before deductions) for full-time year-round civilian workers, adjusted for wage supplements, are employed Such earnings data were estimated for 1964 in the U.S. Department of Health, Education, and Welfare report, "Motor Vehicle Injury Prevention Program," Disease Control Programs, 1966–1. These data were increased to 1968 earnings based on median income data reported in various Department of Commerce "Consumer Income" reports, Series P60-No. 47, September 24, 1965, and No. 66, December 23, 1969.
Table C illustrates the procedure for calculating labor force losses due to all accidents; the same procedure was used for each class of accident. TABLE C.-ESTIMATED VALUE OF LOST EARNINGS DUE TO ACCIDENTS TO PERSONS IN THE LABOR FORCE, BY
SEX AND AGE, 1968
1 Average annual number of work-loss days for the period July 1965-June 1967, national health survey. 2 Work-loss days divided by 245.
2. Housewives' Services The National Health Survey provided data on the average number of bed days due to motor vehicle accidents. For men, the number reported was slightly lower than the number of work-loss days associated with these conditions. The assumption is that all losses for men are for those in the labor force.
For women, the number of work-loss days was deducted from the bed days and the resulting figure was divided by 365 to obtain the estimated number of women not in the labor force who were confined to bed as a result of motor vehicle accidents. To obtain the number keeping house, rates for women not in the labor force and keeping house were applied for the year 1968, as reported by the Bureau of Labor Statistics.
Housewives' services are estimated at the mean earnings of a domestic servant. After adjustment for wage supplement, the 1968 figure is $3,390.
Table D illustrates the calculations for the imputed value in 1968 of losses for housewives' services resulting from all accidents; the calculations were also prepared for each class of accident.
TABLE D.-IMPUTED VALUE OF SERVICES OF HOUSEWIVES DUE TO ACCIDENTS, BY AGE, 1968
1 Number of years keeping house multiplied by $3,390, the imputed value of housewives' services.
3. Total Indirect Costs Total indirect morbidity losses for the labor force and housewives are summarized by age, sex and class of accident on table E. Estimated man-years lost totaled 507 million for all accidents and amounted to $3.6 billion in lost output. Nearly 44 percent of the dollar losses was due to accidents at work. This category was double the losses in any other class of accident. Mortality
Mortality losses—the estimated cost or value to society of deaths from accidents—are the product of the number of deaths and the expected value of an individual's future earnings with sex and age taken into account.
Unpublished discounted lifetime earnings by age and sex were available from Dorothy Rice and Barbara Cooper for 1964. Assuming employment levels remained the same, lifetime earnings discounted at both 6 percent and 8 percent were adjusted to 1968 by the increase in 1964-1968 median income, as shown in table F. (The present value of lifetime earnings by age, sex, color and years of school completed, discounted at 4 percent, for 1964 are published in an article by Dorothy P. Rice and Barbara S. Cooper, “The Economic Value of Human Life," American Journal of Public Health, Vol. 57, No. 11, November 1967.)
Calculation of the 1968 lifetime earnings required consideration of life expectancy for different age and sex groups, changing pattern of earnings at successive ages; varying labor force participation rates, imputed value for housewives' services, and the appropriate discount rate to convert a stream of costs into its present worth. Several of the economic concepts are briefly described below:
1. Cross-Sectional Earnings The appropriate measure used for estimating the lifetime value of an individual's output is the mean earnings (wages and salaries before deductions) of men and women full-time, year-round civilian workers. The mean earnings in five-year age intervals are adjusted upward to take cognizance of wage supplementsemployer contributions for social insurance, private pension and welfare funds.