The Rising Economic Cost of Diabetes

11 January 2017
New research, published in the BMJ Open Journal, shows the costs of older Australians with diabetes are set to soar.

The new study reported that in 2015, diabetic Australians aged 45-64 years old set Australia’s economy back $2.1 billion in costs associated with lost labour.

The research forecasts that by 2030, this cost would have risen to $2.9 billion.

The prevalence of diabetes in adults (aged 20–79 years) was estimated to be 415 million globally in 2015, and this is projected to increase to 642 million by 2040.

The disability burden of diabetes is associated with a range of symptoms such as fatigue, kidney problems, and blurred vision. These complications eventually lead to conditions such as blindness, heart attacks, kidney failure, and poor psychological well-being overall.

Such issues force many older diabetics out of work.

According to the Department of Health, there are just over 1.32 million people registered on the National Diabetes Services Scheme (NDSS), costing the government almost $215 million in the last year, with the majority suffering from the common type 2 diabetes.

Key findings of the report

The report projected the number of people aged 45-64 years who lost ‘productive life years’ (PLYs) due to diabetes and the related costs of this (lost income, extra welfare payments, lost taxation revenue). The report also aimed to calculate the lost gross domestic product (GDP) attributable to diabetes in Australia from 2015-2030.

The key results of the research included the following:

  • The number of Australians who were out of the workforce due to diabetes would hit 21,400 by 2030, up from 18,100 in 2015, an 18% rise over the next 15 years.
  • National costs to the government were $467 million in lost annual income in 2015, increasing to $807 million in 2030, a 73% increase.
  • Extra annual welfare payments increased from $311 million in 2015 to %350 million in 2030, a 13% increase over the next 15 years.
  • Lost annual taxation revenue increased from $102 million in 2015 to $166 million in 2030, a 63% rise.
  • A loss of $2.1 billion in GDP was projected for 2015, increasing to $2.9 billion in 2030, attributable to diabetes through its impact on lost PLYs.


At the individual level, the study also found an increasing income gap between those aged 45-64 years old with diabetes who were forced to leave the workforce, compared to those in full-time work without diabetes.

“By 2030, the income gap between these two groups is projected to be even greater; with those out of the labour force due to their diabetes receiving an annual income four times lower than that of full-time workers without diabetes,” the report states.

“It appears that individuals incur significant costs of diabetes through lost PLYs and lost income in addition to disease burden through human suffering and healthcare costs.

“The government incurs extra welfare payments, lost taxation revenue and lost GDP, along with direct healthcare costs.”

The authors of the report also noted their research did not take into account other more indirect costs of the disease in Australia, such as “informal carer costs”, where a family member is forced to stay home from work in order to care for the person with diabetes.

This report demonstrates the high costs of the disease and its burden on the health system, which require urgent policy attention.

Research was conducted by a number of medical researchers at the University of Sydney’s Charles Perkins Centre and Centre for Rural Health, the Garvan Institute for Medical Research, and researchers at the National Centre for Social and Economic Modelling at the University of Canberra.

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