The Economic and Social Cost of Type 2 Diabetes

On 15 March, we launched a groundbreaking report that lays out the stark reality of the type 2 diabetes epidemic in New Zealand. It also offers hope.

Report commissioned by: Diabetes New Zealand, The University of Otago’s Edgar Diabetes and Obesity Research Centre (EDOR),Healthier Lives – He Oranga Hauora National Science Challenge.

The report was undertaken by PwC New Zealand and funded in part by a generous donation from Tony and Heather Falkenstein.

The Grand Hall at Parliament House was packed for the launch of The Economic and Social Cost of Type 2 Diabetes. Among the more than 200 people assembled, a shared sense of the importance of the event was palpable.

The Hon Peeni Henare launched the report, and we heard a range of powerful speeches. Hon Aupito William Sio spoke candidly of his determination to set a healthy-living example to his community. Diabetes NZ’s own Matire Ropiha riveted the audience with her story of the impact of type 2 diabetes on her whānau. Sir Jerry Mateparae sent a strong reminder of the need for the government to honour Te Tiriti in healthcare. And Professor Jim Mann’s presentation had members of the audience gasping at the statistics, but he didn’t let anyone forget that we are talking about people not numbers.

A JOINT CALL TO ACTION

The report shows that, in Aotearoa, type 2 diabetes has reached epidemic proportions and is on a steep upward trajectory for the next 20 years. However, the report also shows that this steep curve could be flattened or even squashed with the right interventions.

We’re calling on the government to act now to prevent type 2 diabetes, reduce inequities in healthcare across different communities, and improve the quality of life for everyone in New Zealand. The numbers are scary, but if the government acts now we can change that.

The report shows four changes the government can make now to help turn the tide and reduce the costs of type 2 diabetes to individuals and their whānau.

KEY FINDINGS

• The number of New Zealanders with type 2 diabetes is expected to increase by 70% to 90% in 20 years.

• The estimated annual cost of diabetes in NZ is currently $2.1 billion (0.67% GDP). This is projected to increase by 63% to $3.5 billion in 20 years.

• There is a shift towards younger people developing type 2 diabetes, and this is expected to increase the personal and economic impact of type 2 diabetes significantly.

• Inequities and health outcomes will worsen for Māori, Pacific, and Asian populations if no action is taken now.

• Holistic and system-wide response from government, society, and individuals is needed urgently to change the projected type 2 diabetes prevalence, costs, and health outcomes.

• Four interventions could each save hundreds of millions of dollars, as well as increase life expectancy and improve quality of life for a huge number of New Zealanders.

URGENT ACTION NEEDED

Heather Verry, Diabetes NZ chief executive, says, “The new report shows that urgent action is needed now to curb the growing costs of diabetes to the New Zealand economy as well as the costs to individuals and their whānau, both in terms of financial impact and livelihood.”

“We’ve known for a long time that type 2 diabetes is an important and worrying issue in our communities,” says Professor Jim Mann, Director of the Healthier Lives National Science Challenge, “but we now know that its impact on New Zealand can be measured as a fraction of GDP, with the $2.1b annual equivalent to 0.67% of GDP.” That's just the financial cost, before even looking at the human cost.

Tamati Shepherd-Wipiiti from PwC, one of the report’s authors, says, “Pacific, Asian, and Māori peoples are disproportionately affected by this disease, and part of the reason for undertaking this report was to address these health inequities in New Zealand.”

The current and projected prevalence of type 2 diabetes is highest for Pacific peoples, with a quarter of all New Zealand’s Pacific peoples projected to be diagnosed with type 2 diabetes in 20 years’ time. A similar concerning trend for Asian and Māori people demonstrates that, if no further action is taken to address New Zealand’s type 2 diabetes problem, inequities and health outcomes will worsen for these populations.

LOOKING FOR SOLUTIONS

EDOR Director Professor Rachael Taylor says, “The current approach is not working if we want to stem this growing epidemic. Type 2 diabetes is not tracked as a national health target for a start, and yet the figures are growing at an alarming rate. New Zealand needs a holistic and system-wide response from the government, society, and individuals to change the trajectory.

“The report provides a strong case for reorienting policy and prioritising resources to address type 2 diabetes towards more equitable and effective interventions.”

Heather Verry agrees: “By changing from an ambulance at the bottom of the cliff approach to a fence at the top, we could be avoiding more than 600 amputations a year in people with type 2 diabetes.”

Tamati Shepherd-Wipiiti says, “Prevention is key to tackling this disease, and we need effective public health prevention measures in place.”

INTERVENTIONS THAT OFFER HOPE

Despite the dramatically increasing numbers of people with type 2 diabetes in Aotearoa, the report reveals some good news. The team investigated several viable and promising solutions that could reduce both human and economic costs. It found four interventions that would lead to cost benefits as well as vastly improved wellbeing for those with diabetes and their family/whānau.

Jim Mann says, “Although many are aware of type 2 diabetes issues, this report revealed a surprising extent of the issue, and we were also surprised by how successful and cost-effective some of the interventions were.”

At the launch of The Economic and Social Cost of Type 2 Diabetes: Diabetes NZ Board Chair Catherine Taylor, Prof Jim Mann, Hon Peeni Henare, Diabetes NZ chief executive Heather Verry, Prof Rachael Taylor, Hon Aupito William Sio, and Sir Jerry Mateparae.

Each of the team’s chosen interventions addresses a different part of the type 2 diabetes pathway, from preventing pre-diabetes progressing to type 2 diabetes, right through to better treatment for people who already have type 2 diabetes.

THE SUITE OF FOUR INTERVENTIONS

Based on cost–benefit analyses, the report shows significant cost savings could be gained from these four interventions:

1. The healthy people, healthy lives intervention

This aims to prevent New Zealanders from developing type 2 diabetes by providing subsidised whānau/community-centred lifestyle change programmes.

The intervention is estimated to achieve a total government benefit of $42 million and a societal benefit of $88 million.

2. The owning our futures intervention

This enables New Zealanders to reverse type 2 diabetes and simultaneously reduce other obesity-related conditions by providing subsidised, intensive whānau/community-centred lifestyle change programmes.

The intervention is estimated to achieve a total government benefit of $23 million and a societal benefit of $63 million.

3. The better diabetes medications intervention

This aims to enable people to better manage their type 2 diabetes by providing access to “gold standard” subsidised medication (SGLT2 inhibitors and GLP-1 receptor agonists).

For SGLT2 inhibitors, the intervention is estimated to achieve a total government benefit of $510 million and a societal benefit of $510 million.

For GLP-1 receptor agonists, the intervention is estimated to achieve a total government benefit of $595 million and a societal benefit of $148 million.

4. Foot screening and protection

This aims to prevent people with type 2 diabetes from developing serious foot-related complications by providing people with access to optimal foot care services.

The intervention is estimated to achieve cost-saving benefits of $36,000 to $40,000 for each diabetes-related lower limb amputation avoided. If the intervention is implemented as intended, 390 major and 211 minor amputations might be avoided each year.

INCREASING WELLBEING FOR THE FUTURE

The study is about so much more than numbers. It reveals how government investment in the prevention, treatment and care of type 2 diabetes could have a significantly positive impact on New Zealand’s economy and society. The benefits vary with each intervention but are driven primarily by reducing health costs and increasing economic value through increasing life expectancy and productivity.

“As well as economic benefits, significant societal benefit can be achieved by improving peoples’ quality of life and ability to participate in society,” says Heather Verry.

To find out more about the report’s findings, see the Diabetes NZ website: www.diabetes.org.nz/news-and-update/ new-report-cost-of-diabetes-staggering-but-fixable.