Measuring The Impact Of Air Pollution On Health Care Costs

Air pollution contributes to the development of numerous adverse human health outcomes. The Environmental Protection Agency's Environmental Benefits Mapping and Analysis Program-Community Edition (BenMAP-CE) tool is widely used in estimating the health care costs of air pollution and in the development of federal and state regulations and policy. Its default features consider only the costs of hospital and emergency department admissions. A more complete accounting of the chain of costs would include ambulatory and other care. In this article we use employer health insurance claims data to infer additional costs that accompany hospitalizations but are not included in BenMAP-CE. Including additional categories increases BenMAP-CE health care cost estimates by approximately 40 percent for respiratory and cardiovascular patients. That is, for each dollar of health care costs captured by BenMAP-CE, a more complete accounting would include an additional 40 cents. These results suggest that because such air pollution costs are underestimated, the health care benefits associated with reducing air pollution may be much larger than previously estimated.