Return on Investment
Healthcare entities and third-party payers are more apt to invest in interventions when they see a likely “financial return on investment in a reasonable time frame.”49 Return on investment is a business calculation of the gain or loss generated on an investment relative to the results achieved. Return on investment may be achieved and calculated in several ways, including in the form of profit, reduction of losses, or avoided costs.
Diabetes represents a substantial social and economic burden in the United States, with one in three individuals projected to develop type 2 diabetes by 2050, and an annual cost estimated at $327 billion in 2017.50,9 Medical costs for people with diabetes are approximately 2.3 times higher than medical costs for people without diabetes. On average, a person with diabetes incurs $16,750 in medical expenditures each year, of which $9,600 (57%) is directly related to diabetes.9
DSMES can help decrease these costs. DSMES has been shown to be cost-effective by reducing hospital admissions and readmissions44,51,52 as well as estimated lifetime healthcare costs related to a lower risk for complications.53
A systematic review of DSMES interventions found that people with type 2 diabetes who received DSMES achieved an average decrease in hemoglobin A1C (A1C) of 0.57%, in comparison to those who did not receive DSMES.48 Other studies have indicated that DSMES can improve A1C by as much as 1% in people with type 2 diabetes.54
DSMES can also have a positive impact on other clinical and behavioral components of diabetes. Participation in DSMES can:
- Reduce the onset and/or progression of diabetes complications
- Increase quality of life
- Encourage long-term lifestyle behavior change
- Enhance self-efficacy and empowerment
- Increase healthy coping
- Decrease diabetes-related depression
Related clinical improvements may include improvements in lipid profiles, weight, and blood pressure.7,42 These improvements have been shown to reduce costs and lead to a positive return on investment.
Below are additional resources on the return on investment of DSMES:
Diabetes State Burden Toolkit:
This toolkit reports the health, economic, and mortality burden of diabetes in each state.
Building the Business Case for Diabetes Self-Management – A Handbook for Service Managers [PDF – 505 KB]:
This handbook, developed by the Robert Wood Johnson Foundation, builds a financial business case for DSMES, discusses other financial and nonfinancial reasons for DSMES, presents spreadsheet models for computing return on investment, and reviews evidence of DSMES cost-effectiveness.
Diabetes Self-Management Education and Support in Type 2 Diabetes: A Joint Position Statement of the American Diabetes Association, the American Association of Diabetes Educators, and the Academy of Nutrition and Dietetics [PDF – 2 MB]:
This position statement focuses on the needs of individuals with type 2 diabetes, with the goal of improving diabetes care and education, improving individual and population health, and decreasing health care costs associated with type 2 diabetes. It also provides data on the cost benefits associated with DSMES.