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Name: Dane Burden

Professor: Dennis Wilson

Subject: Economics 1010
Date: November 20th, 2016

Economic Effects of Legalized Euthanasia

Bioethical discussions have been debated for years and the progression of
biomedical advances will not only prolong life and cure disparaging conditions but will
inadvertently feed the flames of controversial topics, including euthanasia. While
different institutions, governments and people define the word slightly differently there is
a shared core attribute and that is the outside contribution to end ones own life by
request. Euthanasia has devout constituents fervently headbutting eachs ideological
views and has afforded each the opportunity to creatively market their views, generally
through the use of bias, yet descriptive, slogans that include: right to die, physicianassisted suicide, mercy killing, starve and kill, and good death. This topic has many
layers from the how and when to the who and why and each participant has valid
arguments. However, I would like to peel back the layers rife with emotion and take a
close look at the microeconomic, how this affected the individual and immediate family
and, potentially, macroeconomic effects on the United States economy of legalizing
human euthanasia in the United States.

End of life care is a costly and overwhelming endeavor and one that is easily
overshadowed by the associated emotional stresses. In general medicare expenditure
data is well tracked and readily available and while this means the population and
associated costs will be specific, in general, to those aged 65 and older it contains some

very relevant data. A recent study (Steve Calfo, Jonathan Smith, Mark Zezza 1) on the
last year of life outlined medicare expenditures per year for survivors, enrolled
individuals who survived through the entire year, and descents, individuals who died
during a given year. Data from 1994-1999 demonstrated that the annual per capita cost
for for both survivors and decedent was increasing year over year. In 1999 the per
capita cost for a survivor was $3,669.00 and descent was $24,856.00. While an initial
assumption may be that this increase is the global incremental increase in medical care
costs a closer inspection shows otherwise as the rate of growth for descents was 0.7%
higher than those of survivors, an asymmetrical cost increase. So, how much does one
generally spend in their last year of life and what does this mean on the microeconomic
level? Medicare per capita spending decreases with age with costs for descents
peaking at age 73 with $43,353.00 in medicare spending (Medicares Role in End-ofLife Care2). While what costs are specifically covered by medicare depends on a
several specifics e.g. plan type, type of care given (medical insurance or inpatient care),
duration of stay, etc a general 80% total coverage is going to assumed. This leaves
the remaining 20% to the immediate family of the deceased. Using the per capita
medicare spending for a 73 year old and assuming this was the 80% distribution from
medicare a residual balance of $10,838.25 in outstanding medical bills is present.
Outstanding balances are generally handled in two ways, either pre-death financial
planning or post-death insolvent estate assets. Either way this puts a tremendous
financial burden on a small group of individuals.

1 Centers for Medicare & Medicaid Services, Office of the Actuary, Last Year of Life Study
2 Kaiser Family Foundation, Medicare Spending at the End of Life, Jul. 2016

If we zoom out to a more macro level in the United States One out of every four
Medicare dollars, more than $125 billion, is spent on services for the 5% of beneficiaries
in their last year of life (Penelope Wang 3). That is a huge amount of money, taxpayers
money, which is being applied to people who are, most likely, fully aware their death is
imminent. Imminent has different meanings to each of us in different stages of our lives
and getting an extra month with a loved one is worth the expenditure and many are
willing to financially commit, especially when it is a doctors explicit requirement to keep
you alive. Terminally ill patients deserve support and it proves to be an effective tool,
hoping for the best, but it does cause emotion to overshadow logic and cloud the line
between useful and frivolous. Support added in the last two months of Medicare
patients lives cost contributors $50 billion just for doctor and hospital visits and it has
been estimated that 20 to 30 percent of these medical expenditures may have had
no meaningful impact (Andy Court4). If there really is no meaningful impact during this
final year that means $12.5 billion of taxpayer money is wasted on unnecessary care.
And while this amount is a paltry 0.0008% of the total $15 trillion US GDP and a
respectable 2% of the $600 billion US GDP net exports it is significant enough to prompt
investigation into alternative options for the terminally ill.

Patients should never be refused care or the added support giving them a bit
more hope even if it only accounts for another day, month or year. There are however,
people within this group that do not want to continue living and whose request, in many
countries, for a respectable exit is refused. A legalized euthanasia would allow requests
for a respectable, pain free death to not only oblige the willing and end unnecessary
3 Money, Cutting the High Cost of End-of-Life Care, Dec. 12, 2012
4 CBSNews, The Cost of Dying, Nov. 09, 2009

suffering but help to alleviate a likely strained economy on both a micro and macro
level. Microeconomic estimations for end of life medical care show that it is likely a
residual balance on the order of $10 thousand could be left to immediate family
members. This sum is likely, due to there being a remaining balance, a staggering
amount and one that could be better appropriated to numerous other priorities, such as
funeral costs. AFter aggregating this microeconomic events into a larger view a picture
of the macroeconomic effects of euthanasia begin to appear. While on the whole
medicare expenditures for end of life care amount to a substantial sum not everyone in
this category should or wants to end their life. However, a recent survey (Gallup 5) asked
When a person has a disease that cannot be cured, do you think doctors should be
allowed by law to end the patient's life by some painless means if the patient and his or
her family request it? and got a resounding 70% yes response. The core of this
question ... a disease that cannot be cured does not perfectly correlate to the
medicare expenditures and dying from causes generally associated with old age but it
does bubble to the surface that if you know that you are going to die the majority of
people are accepting of euthanasia. If we were to take a conservative 1% as the
number of people that would opt for terminating life in the year that they are going to die
roughly $1.25 billion medicare dollars would be saved.

There are obvious implications legalizing euthanasia in the U.S. has on family
microeconomics and some clear benefits. The same implications and benefits at a
macro level contain far more assumptions and lack the clarity of the micro scale but, its
influence is still present.

5 Gallup News Service (May 8-11 2007 - May 6-10, 2015)