The huge return on investing in coronavirus tests
Government spending on testing and contact tracing pays for itself more than 30 times over, according to a new paper published by the American Medical Association.
What they found: Harvard economists David Cutler and Lawrence Summers (yes, that Larry Summers) calculated the total cost of the coronavirus pandemic at more than $16 trillion in the United States alone. Of that, about $7 trillion is attributable to loss of life and long-term impairment from the disease.
- Enhanced testing and tracing would cost about $6 million per 100,000 inhabitants, they calculate. Out of that population, 14 lives would be saved, on which they place a value of $96 million, and 33 critical and severe cases would be avoided, representing savings of $80 million.
- That adds up to $176 million in benefits from $6 million in costs — before taking into account any second-order effects from even fewer cases down the road.
The bottom line: "Currently, the U.S. prioritizes spending on acute treatment," write Cutler and Summers, "with far less spending on public health services and infrastructure."
- Going forward, they write, "a minimum of 5% of any COVID economic relief intervention should be devoted to such health measures."