Modeled County Public Health Prevention Clears Cost-Neutral Thresholds Across All Federal Valuation Standards
Testing modeled returns across low, middle, and high federal life value tiers. Checking both point estimates and lower bounds.
County boards and budget officers ask whether a public health program still pays off under cautious assumptions. Federal agencies publish low, middle, and high dollar values for each saved life alongside different hospital savings rules. Checking program returns across all of those cases shows which funding choices stay above breakeven.
Across all three federal tiers ($6.3M, $13.6M, and $20.7M per life), California county public health spending yields a modeled 15.0:1 to 49.3:1 annual return at 2.38 fewer deaths per 100,000 and a 27.2:1 to 89.4:1 cumulative return at 4.32 fewer deaths per 100,000.[1][2] Using one middle number (32.4:1 annual or 58.8:1 cumulative at $13.6M) leaves a plan open to debate over one input.[2] Showing that the lowest joint bound still yields 5.4:1 annually (8.2:1 cumulatively) confirms that the spending pays off under every federal rule.[3]
Table 1. Four Value and Cost Recovery Cases Across HHS 2025 Tiers
Unit A rows value county spending across annual and 13-year cumulative horizons. Unit B rows show CHW cost recovery per worker.
| Case Input |
Case 1: Joint Floor
Low Effect Bound + Low Life Value
|
Case 2: Conservative
Main Effect + Low Life Value
|
Case 3: Central
Main Effect + Middle Life Value
|
Case 4: Upper Tier
Main Effect + High Life Value
|
|---|---|---|---|---|
| Deaths Averted per 100,000 | 0.85 yr | 1.30 cumul fewerlow CI | 2.38 yr | 4.32 cumul fewermain | 2.38 yr | 4.32 cumul fewermain | 2.38 yr | 4.32 cumul fewermain |
| Assumed Federal Life Value Tier (Model Input) | $6.3MHHS Low | $6.3MHHS Low | $13.6MHHS Central | $20.7MHHS High |
| Cost per Life (Annual | 13-Yr)* | $1,176,471 (Yr)$769,231 (13-Yr) | $420,168 (Yr)$231,481 (13-Yr) | $420,168 (Yr)$231,481 (13-Yr) | $420,168 (Yr)$231,481 (13-Yr) |
| Return per $1 Spent (Annual | 13-Yr)* | 5.4:1 (Yr)8.2:1 (13-Yr) | 15.0:1 (Yr)27.2:1 (13-Yr) | 32.4:1 (Yr)58.8:1 (13-Yr) | 49.3:1 (Yr)89.4:1 (13-Yr) |
| Statewide 57-County Value ($10 Scale)* | 332 yr | 507 cumul lives$2.1B-$3.2B | 928 yr | 1,685 cumul lives$5.8B-$10.6B | 928 yr | 1,685 cumul lives$12.6B-$22.9B | 928 yr | 1,685 cumul lives$19.2B-$34.9B |
| Assumed CHW Billing & Offset Case (Model Input)* | $6,775visit bills, 213 units | $10,162visit bills, 320 units | $107,006Medi-Cal plan offsets | $291,171system hospital offsets |
| CHW Cost Recovery Ratio* | 0.07 : 16.5% of cost | 0.10 : 19.8% of cost | 1.03 : 1103.2% of cost | 2.81 : 1280.7% of cost |
Table 1 Notes & * Modeled Estimates
Expand notes
Table 1 Notes (Mode A Scenario Grid on Mode B Inputs & Exposure Horizons): Unit A and Unit B are never multiplied or summed. In Unit A, the annual pre-pandemic TWFE OLS slope is 2.38 fewer deaths per 100,000 per $10/capita (SE = 0.78, 95% CI -3.91 to -0.85; cost per life = $10 × 100,000 / |β_10| = $420,168 at -2.38 and $1,176,471 at the -0.85 lower 95% CI bound), yielding 5.4:1 at the joint floor and 15.0:1 to 49.3:1 across HHS tiers. Over the 13-year cumulative long-difference horizon (-4.32 per 100,000 per $10/capita, SE = 1.54, 95% CI -7.34 to -1.30), cost per life is $231,481 at -4.32 ($769,231 at the -1.30 lower bound), yielding 8.2:1 at the joint floor and 27.2:1 to 89.4:1 across HHS tiers.
Column Scope. Low Effect Bound + Low Life Value. Societal & Clinic | -0.85 Yr / -1.30 Cumul & $6.3M | CHW FFS, 213 Units. Main Effect + Low Life Value. Societal & Clinic | -2.38 Yr / -4.32 Cumul & $6.3M | CHW FFS, 320 Units. Main Effect + Middle Life Value. Societal & Plan | -2.38 Yr / -4.32 Cumul & $13.6M | CHW Plan Offsets. Main Effect + High Life Value. Societal & System | -2.38 Yr / -4.32 Cumul & $20.7M | CHW System Offsets.
Model Crosswalk. Plain table labels map to standard study models. Raw Yearly Average / Simple Avg is an unadjusted OLS model where routine and outbreak budgets mix. County & Year FE is a Two-Way Fixed Effects (TWFE) panel model. Routine-Budget Analysis / 21-Year County Budget Model is a Two-Stage Least Squares (2SLS / Lewbel 2012) model that isolates routine base budget shifts. County Board Budget Rules uses Brown (2014) county board rules.
Two-Ruler Benchmark Summary. Mode A Scenario Grid Built on Observed Effect Estimates and Published HHS 2025 VSL Tiers. Ruler 1: Single Central Point Estimate ($13.6M VSL): 32.4 : 1 (Annual) | 58.8 : 1 (13-Yr Cumulative). Holding the effect at 2.38 fewer deaths/100K annually ($420,168 per life) or -4.32 cumulatively ($231,481 per life) and using the HHS central $13.6M gives one number: 32.4:1 (or 58.8:1). Debate over one value input can then stall the budget choice. Ruler 2: HHS VSL Range ($6.3M-$20.7M Across Annual & Cumulative Horizons): 15.0:1 to 49.3:1 (Yr) | 27.2:1 to 89.4:1 (13-Yr). Varying the HHS 2025 VSL tier moves the annual ratio from 15.0:1 ($6.3M Low) through 32.4:1 ($13.6M Central) to 49.3:1 ($20.7M High) (and 27.2:1 to 89.4:1 over 13-year cumulative horizons). Every tier stays far above the 1.0:1 cost-neutral line.
Method & Data Audit (TooEarlyToSay.com): Public Health Spending Regime Analysis → · Statewide CHW Reimbursement Analysis →
Table 2. How Sensitivity Analysis Turns Input Debates into Funding Choices
Showing which inputs change the return, and which keep it above 1.0:1, focuses budget talks.
| Choice Factor | Case 1: Joint Floor | Case 2: Low Life Value | Case 3: Middle Life Value | Case 4: High Life Value |
|---|---|---|---|---|
| Where the Return Shows Up | Communities gain saved lives at the $6.3M floor while clinics recover 6.5% via FFS. | Communities gain saved lives at the $6.3M life-value tier while clinics recover 9.8% via FFS. | Communities gain saved lives at the $13.6M life-value tier while Medi-Cal plans recover 103.2% of CHW pay. | Communities gain saved lives at the $20.7M life-value tier while hospital systems save 280.7% of CHW pay. |
| Which Question This Case Answers | Tests the low effect bound at the $6.3M life-value tier and 213 CHW visit units. | Tests the main effect at the $6.3M life-value tier and 320 CHW visit units. | Tests the annual and 13-yr effects at the $13.6M life-value tier with plan offsets. | Tests the $20.7M high life-value tier alongside full system hospital savings. |
| Distance From the 1.0:1 Line | County spending returns 5.4:1 annually (8.2:1 cumulatively), while CHW visit billing covers 6.5% of pay. | County spending returns 15.0:1 annually (27.2:1 cumulatively), while CHW visit billing covers 9.8% of pay. | County spending returns 32.4:1 annually (58.8:1 cumulatively), and CHW plan offsets return 1.03:1. | County spending returns 49.3:1 annually (89.4:1 cumulatively), and CHW hospital savings return 2.81:1. |
| Why Multi-Way Checks Help Here | Varying the effect and life-value tier together still clears the 1.0:1 line by 5.4 to 1 annually and 8.2 to 1 cumulatively. | Varying the life-value tier alone spans 15.0:1 to 49.3:1 annually (27.2:1 to 89.4:1 cumulatively). | Matching both HHS $13.6M and EPA $11.2M rules fits federal grant forms. | Keeping Unit A and Unit B apart avoids mixing per-worker and per-resident scales. |
| Best-Fit Budget Rule | Lead With the Joint Floor. Grant the lowest life-value tier and lower effect bound together to show a 5.4:1 annual (8.2:1 cumulative) return. | Show the Full HHS Range. Pair the 32.4:1 annual (58.8:1 cumulative) central ratio with the full HHS life-value range. | Use Central HHS Tier as Base. Anchor county benefit-cost memos in the $13.6M HHS Central tier at 32.4:1 annual and 58.8:1 cumulative. | Split Cash Capture From Health Value. Report CHW visit billing and plan savings apart from saved-life values. |
Table 2 Notes: Scenario Inputs, Benefit-Cost Formula, Exposure Horizons & Fencing
Expand notes
• Inputs (Observed and Published): Mode B empirical coefficients (-2.38 annual TWFE per $10/capita, SE = 0.78, 95% CI [-3.91, -0.85]; -4.32 13-year cumulative long-difference OLS per $10/capita, SE = 1.54, 95% CI [-7.34, -1.30]; -5.31 Long-Difference Lewbel 2SLS) from src/frontend/js/lha-calculator.js, public/tools/lha-calculator/method.html, and Value_of_Public_Health/paper/ajph_submission.tex. Published HHS 2025 VSL schedule ($6.3M / $13.6M / $20.7M) and EPA VSL ($11.2M). CHW cost-capture inputs ($103,719 statewide loaded FTE cost; $6,775 to $10,162 direct FFS billing at 213 to 320 units under DHCS SPA 22-0001; $107,006 Medi-Cal payer offsets; $291,171 societal hospital offsets) from the CHW case study (scripts/build_wave2_flagships.js) and CHWs/08_PhD_Final/DERIVATIONS.md.
• Benefit-Cost Formula & Exposure Horizons (Mode A Scenario Grid, Unit A): On the LHA Calculator $10/capita scale (src/frontend/js/lha-calculator.js: coefficientPer10 = -2.38 annual, cumulativeCoefficientPer10 = -4.32), BCR(β_10, VSL) = (|β_10| / 100,000) × VSL / $10. Annual central case (|β_10| = 2.38, VSL = $13.6M): BCR = 0.0000238 × $13,600,000 / $10 = 32.4 (joint floor at |β_10| = 0.85, VSL = $6.3M: 5.4; cost-neutral |β_10*| at $13.6M = 0.0735 deaths/100K per $10/capita). Over the 13-year cumulative horizon (|β_10| = 4.32), cost per life is $231,481 and BCR spans 8.2:1 (joint floor at |β_10| = 1.30, $6.3M VSL), 27.2:1 ($6.3M Low), 58.8:1 ($13.6M Central), and 89.4:1 ($20.7M High).
• Unit-of-Analysis Fencing: Unit A rows value county public health mortality reductions with VSL. Unit B rows describe one CHW FTE per year and use cash or resource offsets with no VSL. CHW scenarios are placed in columns by conservatism order only; they are not linked to the VSL tier in the same column.
Why the Goal of Sensitivity Analysis Is Decision Robustness, Not Parameter Perfection
County fiscal reviews test whether a public health investment remains cost-effective across conservative and upper-bound federal valuation tiers: should the analysis use the U.S. EPA $11.2M Value of a Statistical Life, the HHS $13.6M central benchmark, or the $6.3M HHS low tier? When an analyst presents only a single point estimate (32.4:1 annual or 58.8:1 cumulative), any disagreement over one input casts doubt on the entire recommendation.
Sensitivity analysis reframes the conversation around which assumptions change the decision. Across the HHS 2025 VSL range, county public health spending returns 15.0:1 to 49.3:1 annually and 27.2:1 to 89.4:1 over 13-year cumulative horizons, and the joint floor (lower confidence bound at $6.3M) still returns 5.4:1 annually and 8.2:1 cumulatively, so the funding verdict does not depend on the VSL tier or exposure horizon. CHW cost capture behaves differently: direct FFS billing recovers 6.5% to 9.8% of a $103,719 position and payer offsets recover 103%, so for CHW programs the financing perspective, not the valuation tier, determines whether the budget closes.
Data Sources, Model Inputs, Notes & Endnotes
(Numbered endnotes [1]–[7], state data sources & math rules)
Expand details
Case Study Focus: System Dynamics & Feedback · VSL Tiers & Parameter Uncertainty (Mode A Scenario Grid)
Numbered Endnotes & Main Sources
- [1]Federal Value of a Statistical Life (VSL) Tiers (2025): HHS ASPE 2025 Guidelines for Regulatory Impact Analysis ($6.3M Low, $13.6M Central, and $20.7M High VSL tiers; EPA VSL benchmark $11.2M = 26.7:1 annual and 48.4:1 cumulative).
- [2]California County Public Health Mortality Reduction, Bounds & Exposure Horizons: CAPHE Local Health Authority (LHA) Calculator Methodology (Cholette et al., 2026) evaluates both the annual pre-pandemic TWFE slope of -2.38 deaths/100K per $10/capita (95% CI -3.91 to -0.85; $420,168 per life saved, 15.0:1 to 49.3:1 across HHS tiers, and 5.4:1 at the joint lower bound) and the 13-year cumulative long-difference slope of -4.32 deaths/100K per $10/capita (95% CI -7.34 to -1.30; $231,481 per life saved, 27.2:1 to 89.4:1 across HHS tiers, and 8.2:1 at the joint lower bound).
- [3]California CHW Cost-Capture Scenarios: DHCS SPA 22-0001 fee-for-service reimbursement (6.5% to 9.8% wage capture) vs. inpatient/emergency cost offsets ($285,900/yr vs. $98,469/yr wage) and net cost per healthy year gained ($7,771/QALY at +8.18 QALYs over 2 years).
- [4]U.S. EPA Mortality Risk Valuation ($11.2M VSL)
- [5]Sanders, G. D., et al. (2016), "Recommendations for Conduct, Methodological Practices, and Reporting of Cost-effectiveness Analyses: Second Panel on Cost-Effectiveness in Health and Medicine", JAMA, 316(10), 1093-1103
- [6]DHCS Medi-Cal CHW Benefit (SPA 22-0001)
- [7]California State Controller
Mode Classification (Mode A Scenario Grid on Observed and Published Inputs): The cross-multiplied scenario cells in Table 1 (5.4:1 to 49.3:1 annual, 8.2:1 to 89.4:1 13-year cumulative, model-implied statewide valuations across 39M California residents, and CHW recovery ratios 0.07:1 to 2.81:1) are Mode A sensitivity calculations. Their inputs are observed econometric estimates (-2.38 annual TWFE, 95% CI [-3.91, -0.85]; -4.32 13-year cumulative OLS, 95% CI [-7.34, -1.30]), published HHS 2025 VSL schedules ($6.3M / $13.6M / $20.7M), the EPA VSL ($11.2M), and calibrated CHW cost and offset values from the CHW case study.
Primary References & Data Sources: HHS ASPE Guidelines for Regulatory Impact Analysis (2025 VSL Schedule: $6.3M Low, $13.6M Central, $20.7M High); U.S. EPA Mortality Risk Valuation ($11.2M VSL); Sanders, G. D., et al. (2016), "Recommendations for Conduct, Methodological Practices, and Reporting of Cost-effectiveness Analyses: Second Panel on Cost-Effectiveness in Health and Medicine", JAMA, 316(10), 1093-1103; DHCS Medi-Cal CHW Benefit (SPA 22-0001); and California State Controller.
Companion Method & Code Guides (TooEarlyToSay.com)
- Public Health Spending: When Emergency Aid Flips the Sign. Across 57 California counties from 2003 to 2023 (1,163 county-years), each dollar per capita corresponds to -0.238 fewer deaths per 100,000 in 2003 to 2019 versus +0.247 in 2020 to 2023.
- Why Flat Medi-Cal Rates Underfund Community Health Care. Across 58 California counties and 9,039 census tracts, a flat $31.74 Medi-Cal fee schedule covers 3.2% to 8.9% of modeled field community health worker costs.
Common Questions & Method Notes
- What is the difference between one-way and multi-way sensitivity analysis?
- One-way sensitivity analysis varies a single parameter at a time while holding all other inputs at their central values (for example, varying VSL from $6.3M to $20.7M at the -2.38 annual effect size, yielding 15.0:1 to 49.3:1, or 27.2:1 to 89.4:1 at the -4.32 cumulative effect size). Multi-way sensitivity analysis varies two or more uncertain parameters together (such as combining the $6.3M Low VSL with the -0.85 annual or -1.30 cumulative lower 95% confidence bound to test a 5.4:1 to 8.2:1 conservative joint floor).
- What is a "cost-neutral threshold analysis" in cost-benefit modeling?
- Cost-neutral analysis asks how small the program effect would have to be for benefits to just equal costs (BCR = 1.0:1). At the $13.6M HHS Central VSL, a $10/capita investment reaches cost neutrality if it averts 0.0735 deaths per 100,000 residents, meaning the observed -2.38 annual effect is 32 times larger (and the -4.32 cumulative effect is 59 times larger) than the cost-neutral minimum.
- Why are CHW cost-capture scenarios reported in separate rows from VSL-based returns?
- The two measure different units. VSL-based returns value mortality reductions from county public health spending, while CHW cost capture compares cash or resource offsets with the $103,719 annual cost of one California CHW position. Direct FFS billing recovers 6.5% to 9.8% of that cost and Medi-Cal payer offsets recover about 103%, so the CHW financing question depends on who captures the savings instead of on the VSL tier.