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Oct. 22, 2020

Untangling the complicated relationship of health, economy during COVID-19 restrictions

Policymakers are having a challenging time navigating the most effective way to monitor public health while also supporting the economic health of their states during the COVID-19 pandemic.

 

Because, says a Michigan State University researcher, health and economics are not opposite sides of a coin, but present interwoven challenges that require officials to use accurate data from both to reach best outcomes.

 

In a paper recently published online by SSRN, Alireza Boloori, an assistant professor in the Department of Statistics and Probability with a joint appointment with family medicine, and his co-author, Harvard University’s Soroush Saghafian, an associate professor of public policy observed the differences between healthy days and economic costs during different levels of pandemic restrictions. For the study, the researchers analyzed data from all 50 states and the District of Columbia and compared each state's Quality Adjusted Life Year days (which is defined as one year of perfect health is equal to one QALY but since the time period of this study was less than one year, the measurement is listed as QALY days and is measured in days) and the economic costs based on four different policy scenarios.

 

The scenarios were based on whether interventions like stay-at-home executive orders, nonessential business closures, large-gathering bans and school closures were implemented. The data was analyzed for the time period from March 1 to June 30, 2020.

 

The first scenario assumed that no restrictions were in place (a hypothetical scenario); the second one lifted the interventions on April 30; the third variation looked at what happened when the restrictions lifted on May 31; and the fourth scenario showed what happened when there were consistent restrictions throughout the entire time period.

 

“You would expect stricter restrictions to save more lives, but the economic costs were a bit of a mystery,” Boloori said. “We wanted to provide a quantitative framework for healthcare policy makers and authorities to develop more effective policies based on data.”

 

When the researchers compared the actual policies undertaken in each state during the March-June period, they could assess each state’s level of interventions, health, economy and the influence of political agendas. On the health side of the equation, the average increase in QALY in days varied from 0.09 (less restrictions) to 6.00 days (more restrictions) across states. While on the economic side, the total cost per person ranged from $375.48 (less restrictions) to $4,953.81 (more restrictions).

 

Even states that bordered each other had wildly different outcomes. For example, one QALY day costs about $697 in Nevada and $2,254 for Utah. 

 

“Health implications will drive direct costs such as the number of people infected, ICU beds, and ventilators but the economy will mainly impact indirect costs such as the number of jobs lost, businesses closed, and people laid off,” Boloori said. “There is no on-size-fits-all solution or perfect scenario.”

By: Emilie Lorditch

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