Adjusted productivity costs of stroke by human capital and friction cost methods: a Northern Finland Birth Cohort 1966 study

Ina Rissanen (), Leena Ala-Mursula, Iiro Nerg and Marko Korhonen
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Ina Rissanen: University of Oulu
Leena Ala-Mursula: University of Oulu
Iiro Nerg: University of Oulu

The European Journal of Health Economics, 2021, vol. 22, issue 4, No 4, 545 pages

Abstract: Abstract Background Productivity costs result from loss of paid and unpaid work and replacements due to morbidity and mortality. They are usually assessed in health economic evaluations with human capital method (HCM) or friction cost method (FCM). The methodology for estimating lost productivity is an area of considerable debate. Objective To compare traditional and adjusted HCM and FCM productivity cost estimates among young stroke patients. Methods The Northern Finland Birth Cohort 1966 was followed until the age of 50 to identify all 339 stroke patients whose productivity costs were estimated with traditional, occupation-specific and adjusted HCM and FCM models by using detailed, national register-based data on care, disability, mortality, education, taxation and labour market. Results Compared to traditional HCM, taking into account occupational class, national unemployment rate, disability-free life expectancy and decline in work ability, the productivity cost estimate decreased by a third, from €255,960 to €166,050. When traditional FCM was adjusted for occupational class and national unemployment rate, the estimate more than doubled from €3,040 to €7,020. HCM was more sensitive to adjustments for discount rate and wage growth rate than FCM. Conclusions This study highlights the importance of adjustments of HCM and FCM. Routine register-based data can be used for accurate productivity cost estimates of health shocks.

Keywords: Productivity costs; Human capital method; Friction cost method; Stroke; Cohort study (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1007/s10198-021-01271-7

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