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Center for Economic Development


CEOs for Cities created the city dividend concept to catalyze collaborative economic progress in cities and regions. A city dividend is the economic benefit resulting from investing resources to successfully achieve a measurable, actionable goal toward your city’s and metro region’s economic progress.

This report explores the Health/Diabetes Dividend. The Health/Diabetes Dividend estimates the costs of diabetes and the economic savings associated with reducing the number of diabetics. Detailed methodology on how the Health/Diabetes Dividend is calculated and associated data sources is included in Appendix A.

Health/Diabetes Dividend

According to the American Diabetes Association (ADA), the total annual cost of thisdisease to individuals and society in the United States in 2012 was $245 billion. These costs include $176 billion in direct medical expenditures and $69 billion for indirect expenses due to absenteeism, presenteeism (not working to capacity while being at work), reduced productivity, disability, and early death. Moreover, it is not just the effects on the individuals that suffer from diabetes, but rather there are systemic problems associated with the disease, especially economic consequences of productivity loss in a team workplace environment. A 2006 study showed that there are productivity losses in team environments when a worker is absent due to illness; and there is a ripple effect of productivity loss since the team is dependent upon all of its workers. Employers understand that it is important to help employees manage chronic illness in order to help decrease absenteeism and loss of productivity, while policy makers see an opportunity to align social welfare funding with chronic care management. The Health/Diabetes Dividend enumerates the ADA’s calculations at the metropolitan level and asks, “What will be the total economic savings (medical and indirect) if a metro region has one percentage less diabetics in their population?”