The Economic and Fiscal Effects of Adverse Health Conditions in Kentucky

Diseases and other adverse health conditions can negatively affect an individual’s employment. An individual suffering from these conditions may be less productive at work, work fewer hours, earn lower wages, and be less likely maintain employment. Most of these adverse effects are borne by the individuals and their families. However, they can also have fiscal implications for the state. Individuals who suffer from health conditions may contribute less to tax revenues and require more public assistance such as Medicaid. In an effort to better understand the implications of health conditions on the state, the Department of Public Health (DPH) requested that the Center for Business and Economics (CBER) evaluate how health conditions can affect the state’s workforce and budget and how treatment and prevention programs could address these adverse effects. Under this proposal, DPH would identify three categories of health conditions and up to three programs aimed at addressing each condition. CBER would review and summarize the research on how these programs affect health outcomes, quality of life, health care expenditures, employment, and earnings. CBER will estimate how implementing these programs in Kentucky could affect its residents and the state budget.