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Journal of Studies on Alcohol and Drugs logoLink to Journal of Studies on Alcohol and Drugs
. 2022 Jul 18;83(4):512–524. doi: 10.15288/jsad.2022.83.512

Beyond the Drinker: Alcohol's Hidden Costs in 2016 in Australia

Heng Jiang a,b,*, Christopher M Doran c, Robin Room a,d, Tanya Chikritzhs e, Jason Ferris f, Anne-Marie Laslett a
PMCID: PMC9318697  PMID: 35838428

Abstract

Objective:

Drawing on a study of the range and magnitude of harms that alcohol caused to specific others in Australia, and on social and health agency statistics for collective costs, this article produces an analysis of the economic cost of alcohol's harm to others (AHTO) in Australia.

Method:

This study used a general population survey and routinely collected social response agencies’ data to quantify different costs of AHTO, using methods consistent with International Guidelines for Estimating the Costs of Substance Abuse. This approach estimates costs for health care and social services, crime costs, costs of productivity loss, quality of life-year loss and other expenses, including both tangible costs (direct and indirect) and intangible costs of loss of quality of life (respondents’ self-reported loss of health-related quality of life).

Results:

The cost of AHTO in Australia was AUD$19.81 billion (95% CI [11.99, 28.34]), with tangible costs accounting for 58% of total costs ($11.45 billion, which is 0.68% of gross domestic product in 2016) and intangible costs of $8.36 billion. The costs to private individuals or households ($18.1 billion and 89% of total costs of AHTO) are greater than the costs to the government or society because of others’ drinking in Australia.

Conclusions:

This study presents an estimation of the economic cost of harm from others’ drinking. The economic costs from others’ drinking are large and of much the same magnitude as the costs that drinkers impose on themselves, as found in previous studies. Preventing harm to others from drinking is important as a public health goal for both economic and humane reasons.

Alcohol use is one of the leading risk factors for noncommunicable diseases and injuries: alcohol consumption causes 3 million deaths every year, representing 5.3% of total global deaths in 2016 (World Health Organization, 2018), as well as many social problems, such as street assaults, family violence, productivity loss, and financial stress. The societal economic cost of alcohol use is large, amounting to more than 1% of the gross national product in many high- and middle-income countries (Rehm et al., 2009). The cost of excessive alcohol consumption was estimated at USD$249 billion in the United States in 2010, and the societal cost of alcohol use was CAD$16.6 billion in Canada in 2017 (Canadian Substance Use Costs and Harms Scientific Working Group, 2020; Sacks et al., 2015). Australian estimation of alcohol-related social costs has been dominated by the work of Collins and Lapsley from the 1990s to 2008 (Collins & Lapsley, 2008), showing that the social cost of alcohol use in 2004–2005 was AUD$15.3 billion; this was updated by others with the same methods (AUD$14.4 billion) using 2010 data (Manning et al., 2013). A more recent societal cost study on alcohol published by the National Drug Research Institute estimated that alcohol was responsible for AUD$18.2 billion in tangible costs and AUD$48.6 billion in intangible costs in Australia in 2017–2018 (Whetton et al., 2021). Although previous studies may have included a small proportion of costs estimated to be for harms from others’ drinking (particularly in traffic accident injuries and fatalities among passengers and pedestrians), most of the costs that they measured were costs or harms to the drinker him/herself or for services to the drinker. But the negative consequences of alcohol misuse often extend to people other than the drinker and include alcohol-related traffic accidents, crime, violence and aggression, family hardship, caring for drinkers and their dependents, and harm to the developing fetus (Gmel & Rehm, 2003; Room et al., 2016; Waleewong et al., 2018). Existing cost-of-alcohol studies include costs to the health and criminal justice systems as well as lost productivity but have not included interpersonal costs—the costs of drinking to others—thus underestimating the overall cost of alcohol to society (Marsden Jacob Associates, 2012). Hence, quantifying interpersonal costs attributable to others’ drinking will be of substantial policy significance.

A government-funded report in the United Kingdom concluded that the estimated cost of alcohol's harm to others (AHTO) in 2004 was up to £15.4 billion (0.8% of the United Kingdom's gross domestic product in 2004), including £1.4 billion–1.7 billion to the health service, up to £7.3 billion in crime and public disorder costs, and up to £6.4 billion in workplace-related costs (Gell et al., 2015). But these costs are a considerable underestimate because the costs estimated are mainly the costs of harm from others’ drinking to the government and society, and they largely excluded costs to individuals, family, and households. A systematic review study by Navarro et al. (2011) found that there were 25 studies on the costs of AHTO. Most focused on fetal alcohol syndrome, and few reported on the magnitude of costs from harm to adults other than the drinker. Furthermore, the methodological quality of studies aimed at measuring the costs of alcohol imposed on those other than the drinker has been only average. Navarro et al. (2011) argued that a critical reason for underestimation of the social cost of alcohol is that the costs of harm to specific people other than the drinker are rarely reported. The last decade has seen more studies of AHTO; among these, particularly those using multiple methods that draw on service response system data and survey data have the capacity to identify and cost such externalities (Laslett et al., 2010, 2020; Room et al., 2010, 2019). These studies have developed a framework for studying harms due to others’ drinking and broadened the coverage of harms that are due to others drinking, such as attributable fractions for traffic injuries, financial burden, caregiving, and extra workplace responsibilities that are due to others’ drinking. A recent Thai cost study covered part of the missing costs, measuring out-of-pocket expenses because of others’ drinking and finding annual expenses for those affected of 8,467 Baht (USD$476.85 PPP [purchasing power parity]) per affected person (Waleewong et al., 2019). Our Australian study also found that the cost of informal care-giving because of others’ drinking in Australia is AUD$250 million annually ($768 per employed caregiver) (Jiang et al., 2017). Although these efforts covered a few harms from others (mainly the costs to particular persons or households), the broader picture of economic costs of AHTO remains unclear. In addition, none of these previous studies has estimated costs to health care and social service agencies or costs of health-related quality of life (QOL) loss attributable to others’ drinking. Adopting a cost framework (using both cost of illness and societal costing methods) developed in the International Guidelines for Estimating the Costs of Substance Abuse (Single et al., 2003), we will address these research gaps in this study.

Understanding the costs of AHTO will provide more accurate estimates of the true economic burden of alcohol. This is crucial for appropriate funding for care to those harmed and will provide support for policymakers to put effective measures for prevention into practice. This study aims to quantify a variety of elements of economic cost due to others’ drinking in Australia, with the specific objectives of measuring (a) tangible costs (costs of health care and social services, time spent seeking health and social services, out-of-pocket expenses, and loss of productivity) and (b) intangible costs (the QOL loss attributable to other people's alcohol consumption).

Method

An overarching framework

The study applied a standard cost method (cost of illness and societal costing) for costing different aspects of AHTO. This costing method was specified in the International Guidelines for Estimating the Costs of Substance Abuse, Second Edition (Single et al., 2003), which has been used in previous studies estimating alcohol's costs of harm to drinkers (Harwood, 2000; Purshouse et al., 2010; Rehm et al., 2007). In brief, this approach estimates the proportion of national costs for health care and social services, crime costs, costs of productivity loss (mortality- and morbidity-associated productivity or life loss and time spent in seeking treatment and social services), and other expenses (out-of-pocket expenses and property damage) that can be reasonably attributed to others’ alcohol use. A three-stage analysis procedure was undertaken. A combination of data on the impacts of others’ drinking obtained from a national representative population survey (AHTO) in 2008 of those age 18 or older and case-records data in 2016–2017 collected routinely by social response agencies—the police, health services, treatment agencies, child protection agencies, helplines, and so on—were used to estimate the costs of others’ drinking in Australia and are outlined in Figure 1.

Figure 1.

Figure 1

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Study workflow for estimating the economic costs of alcohol's harm to others

The estimate in this study is based on the most recent available data for each category. The costs of mortality, morbidity, interpersonal violence, and social services because of others’ drinking were calculated from the secondary agency data in calendar year 2016 or the financial year 2016–2017 (see Stage 1 in Figure 1), and the costs to private individuals and households were calculated based on the 2008 AHTO survey data (see Stage 2 in Figure 1). All cost estimates were then converted to 2016 prices, as described below. Ethical approval for the study was obtained from the Victoria Department of Human Services (Approvals Human Research Ethics Committee 108/07 and 20/08).

Quantifying morbidity and mortality attributable to others’ drinking

National mortality data for 2016 were sourced from the Australian Bureau of Statistics (ABS) Mortality Datafile (Australian Bureau of Statistics, 2019b). Cause of death was recorded according to the International Classification of Diseases, 10th Revision (ICD-10; World Health Organization, 1992). National morbidity data for 2016–2017 were obtained from the Australian Institute of Health and Welfare's (AIHW) compilation of clinical information on hospital separations (referred to here as hospitalizations) (Australian Institute of Health and Welfare, 2019). Child assault and abuse (ICD-10: X85-Y05, Y06-Y09, Y87.1 for years 0–14) and road crash (ICD-10: V02-V04 [.1, .9], V06.1, V09.2, V09.3, V29-V79 [.4–.9], V80.3-V80.5, V81.1, V82.1, V82.9, V83.0-V86 [.0–.3], V87.0-V87.9, V89.2, V89.3, V89.9 for both pedestrian and nonpedestrian ages 0–14 years) and adult assault (ICD-10: X85-Y90, Y87.1 for years ≥15) and road crash (ICD-10 codes V02-V04 [.1, .9], V06.1, V09.2, V09.3, V29-V79 [.4–.9], V80.3-V80.5, V81.1, V82.1, V82.9, V83.0-V86 [.0–.3], V87.0-V87.9, V89.2, V89.3, V89.9 for both pedestrian and nonpedestrian age ≥15 years) were used to quantify the mortality and morbidity attributable to the drinking from others (Laslett et al., 2010).

Population-level alcohol-attributable fractions (PAAFs) were used to estimate injuries and hospitalizations attributable to alcohol use by other people, a method that has been widely used to estimate alcohol's burden of diseases globally (Griswold et al., 2018). PAAFs for victims’ road injuries and deaths were derived from Ridolfo and Stevenson (2001) and the most recent Australian study of alcohol's burden of disease (Australian Institute of Health and Welfare, 2018b) (please see Section 4 in the Appendix for more details on computing PAAFs for victims’ road injuries and deaths). For assaults among adults (≥15 years), PAAFs for victims of assault were derived from analyses in the AHTO report (Laslett et al., 2010) and records from the Western Australia Police Force (2020) and New South Wales Bureau of Crime Statistics (2020). Alcohol-attributable deaths and person-years of life lost (PYLLs) were estimated using methods described in Mathers et al. (1999). Alcohol-attributable fractions for productivity loss and financial and intangible harms were calculated based on the prevalence of various types of harms in the AHTO survey (see the AHTO study report [Laslett et al., 2010]), and the prevalence of AHTO is also presented in tables that follow.

Costs related to hospital admissions were valued by multiplying each alcohol-attributable hospital separation by the corresponding average cost for the diagnosis, using the Diagnosis Related Groups (DRGs) in the National Hospital Cost Data Collection—Financial year 2016–17 (Independent Hospital Pricing Authority, 2019). For example, the average cost per hospitalization for major acute injuries (DRG code: X60A) was AUD$5,540.96 in the financial year 2016–2017. The average intangible value of the loss of 1 year of life was sourced from Collins and Lapsley's report (2008) and converted to 2016 prices (AUD$73,919). The human capital approach was used to compute productivity loss attributable to others’ drinking, and productivity loss was costed using daily earnings calculated from weekly average earnings (Australian Bureau of Statistics, 2017a).

Quantifying violent crime and child protection cases attributable to others’ drinking

Data on the number of police-reported cases of violent crimes (including domestic and nondomestic violence and sexual violence) were obtained from the ABS report on recorded crime committed in 2016 (Australian Bureau of Statistics, 2017b). These national crime data do not indicate what proportions of these incidents of violence are alcohol related. However, crime data in two Australian states (Western Australian and New South Wales) have specified whether the perpetrators were under the influence of alcohol when they committed the violence or crime. PAAFs for domestic and nondomestic violence and sexual violence in 2016 were abstracted from the Western Australia Police Force and New South Wales Bureau of Crime Statistics and Research statistics. The proportions of child protection cases that were alcohol related in Victoria and New South Wales were roughly estimated as 33% and 31.3% (Laslett et al., 2010). Because of a lack of alcohol-attributable fraction estimation for other states and territories, a conservative approach was adopted and an assumption made that 31.3% of total child protection cases nationwide were alcohol attributable. National real recurrent expenditures on child protection, out-of-home care services, and intensive family support services for 2016 were obtained from the Productivity Commission's Report of Government Services 2016 (Steering Committee for the Review of Government Service Provision, 2018).

Quantifying quality-of-life loss attributable to others’ drinking

Consistent with practice in other cost studies, this study also estimated intangible costs, defined as those that “are not usually exchanged in private or public markets, such as fear, pain, suffering, and lost quality of life” (Cohen, 2005). Methods developed by Dolan and Peasgood (2007) for measuring economic and social costs of the fear of crime were applied to data from the AHTO survey. The method for calculating the value of intangible loss relies on using respondents’ self-reported loss of health-related QOL (in quality-adjusted life-years [QALYs]) using the EQ-5D score, a standardized and non–disease-specific measure (EuroQol Group, 1990; Livingston et al., 2010). Those who score 1 are in perfect health and those who score 0 are dead. Using the health-related QOL score (EQ-5D score) reported by respondents, the difference between those who reported being negatively affected a lot or a little (harmed a lot or a little) and those who reported no negative effects from others’ drinking in the last 12 months was then multiplied by the value of a QALY (Johansson et al., 2006). This study valued a QALY at AUD$50,000, within the range of values used internationally for the year 2008 (Room et al., 2010; Wang et al., 2018).

Quantifying time loss in informal caregiving, extra work, and property damage attributable to others’ drinking

In the survey of AHTO with a representative sample, respondents were asked directly about out-of-pocket costs in diverse situations arising from someone else's drinking and time lost or spent because of others’ drinking—for instance, cleaning up, filling in for a workmate, driving an intoxicated relative or their dependent home or getting help, and working extra hours (the method of the AHTO survey is presented in the Appendix, Section 8). Cost of time lost/spent was valued using respondents’ self-reported time, multiplied by the average hourly wage rate in 2008 sourced from the ABS (Australian Bureau of Statistics, 2008). The cost of time or productivity loss attributable to caring for others, working extra hours, and seeking health and social services was calculated among employed respondents only. Out-of-pocket costs, such as costs of property or personal belongings that were damaged because of others’ drinking, were estimated by the respondents themselves for the most recent occurrence in the last 12 months in the 2008 survey.

Quantifying alcohol and other drugs and other social service use attributable to others’ drinking

Data on national alcohol and other drugs (AOD) treatment services were collected from the AIHW (2018a) report Alcohol and Other Drug Treatment Services in Australia 2016–17. Data on the use of DirectLine and mean cost of AOD services were collected from the Department of Health and Human Services Victoria and Turning Point Alcohol and Drug Centre. The national cost of DirectLine services was extrapolated from the Victoria estimations. The opportunity cost of time spent by people seeking services and the out-of-pocket expenses involved for people using services attributable to the drinking of others were derived from the AHTO analyses on service utilization (Laslett et al., 2010). More details on quantifying the costs of time spent seeking services and out-of-pocket expenses experienced by people using services are elaborated on in the Appendix, Section 8.

The costs of AHTO are all adjusted to 2016 Australian dollars across various items of harm, using the ABS consumer price index (Australian Bureau of Statistics, 2019c). This gives an indication of how much those harms attributable to others’ drinking would have cost in Australian society in the same year covered by the cost estimates from agency secondary data.

The study presents the estimates of economic costs and corresponding 95% confidence intervals (CIs) in the analysis section. In the case of survey-based estimates, the range reflects sampling CIs. For several register-based estimates, low and high estimates were derived from different data sets.

Results

Estimated costs of premature death and hospitalizations attributable to others’ drinking

In Australia, 22% of all road crash fatalities were estimated to be victims of impaired-driver road crashes. About 10.4% of all road crash hospitalizations were estimated to be victims of impaired-driver road crashes (a more detailed PAAF calculation is in the Appendix, Section 4). Applying these PAAFs in our analyses, we estimated that alcohol-attributable child and adult deaths and hospitalizations in Australia were 221 deaths and 13,374 hospitalizations in 2016 (shown in Table 1), with total estimated costs in Australia of AUD$373.59 million and $84.39 million, respectively.

Table 1.

The costs of morbidity and mortality attributable to others’ drinking in 2016 (cost values in 2016 prices, in Australian dollars)

graphic file with name jsad.2022.83.512tbl1.jpg

Type of harms Mortality Morbidity
Alcohol-attributable deaths Alcohol-attributable PYLL Total mortality costs($million) Alcohol-attributable hospitalizations Cost per hospitalization ($) Hospital costs ($million) Lost output costs ($million) Total morbidity costs ($million)
Child assault & abusea 6 185 1 2.1 9 175 2,030 0.66 - 0.66
Child road crashb 13 360 25.21 585 5,541 3.24 - 3.24
Adult assaultc 92 2,153 150.75 10,035 5,541 55.60 7.60 63.20
Adult road crashd 110 2,648 185.41 2,579 5,541 14.29 3.00 17.29
Total 221 5,326 373.59 13,374 - 73.79 10.60 84.39
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Notes: PYLL = potential years of life lost (detailed calculation method was elaborated in Appendix–Section 5). The average intangible value of the loss of 1 year's living in 2016 prices was $70,018, computing based on the value of one PYLL in the report of Collins & Lapsley, 2008, and adjusting for inflation. Child was defined as ages 0–14 years, and adult as 15 years and older.

a

Based on ICD-10 codes X85-Y05, Y06-Y09, Y87.1 for children ages 0–14 years.

b

Based on ICD-10 codes V02-V04 (.1, .9), V06.1, V09.2, V09.3, V29-V79 (.4-.9), V80.3-V80.5, V81.1, V82.1, V82.9, V83.0-V86 (.0-.3), V87.0-V87.9, V89.2, V89.3, V89.9 for both pedestrian & nonpedestrian ages 0–14 years. The population-attributable fraction for alcohol-attributable road traffic crash among ages 0–14 years was computed in Appendix–Section 4.

c

Based on ICD-10 codes X85-Y90, Y87.1 for adults age 15 years and older.

d

Based on ICD-10 codes V02-V04 (.1, .9), V06.1, V09.2, V09.3, V29-V79 (.4-.9), V80.3-V80.5, V81.1, V82.1, V82.9, V83.0-V86 (.0-.3), V87.0-V87.9, V89.2, V89.3, V89.9 for both pedestrian & nonpedestrian age 15 years and older. The population-attributable fraction for alcohol-attributable road traffic crash among ages 15 years and older was computed in Appendix–Section 4.

Estimated costs of violence and child abuse attributable to others’ drinking

Estimated alcohol-related interpersonal violence incidents were 40,791 for domestic violence and 154,666 for nondomestic and 46,736 for sexual violence in Australia in 2016 (Table 2). The total estimated cost of violence attributable to others’ drinking in Australia was AUD$560.12 million in 2016, including $99.07 million for domestic violence, $375.65 million for nondomestic violence, and $85.40 million for sexual violence.

Table 2.

Cost to victims in alcohol-related nondomestic and domestic violence in 2016 (cost values in 2016 prices, in Australian dollars)

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Type of harms Mean cost per domestic and nondomestic violence incidence ($)a Cost of nondomestic violence ($million) [95% CI] Cost of domestic violence ($million) [95% CI] Mean cost per sexual violence incidence ($) Sexual violence ($million) [95% CI]c Total costs ($million)
Costs to the victim
 Opportunity cost of time spent calling police 7.09 1.10 [1.06, 1.13] 0.29 [0.27, 0.30] - - 1.39 [1.33, 1.44]
 Cost of time spent seeking counseling 11.37 1.76 [1.70, 1.82] 0.46 [0.44, 0.49] - - 2.22 [2.14, 2.31]
 Cost of personal belongings damage 217.86 33.70 [32.58, 34.81] 8.89 [8.40, 9.37] - - 42.58 [40.99, 44.18]
 Cost of lost outputb 1,136.68 175.81 [170.01, 181.60] 46.37 [43.84, 48.90] 1,800.00 84.12 [71.18, 97.06] 306.29 [285.02, 327.56]
Health system costs
 Emergency department costs 42.25 6.53 [6.32, 6.75] 1.72 [1.63, 1.82] - - 8.26 [7.95, 8.57]
 Other medical cost 1,013.54 156.76 [151.59, 161.93] 41.34 [39.09, 43.60] 580 1.28 [1.08, 1.48] 199.38 [191.76, 207.01]
Total 375.65 [363.26, 388.04] 99.07 [95.81, 102.34] 85.40 [72.26, 98.54] 560.12 [531.33, 588.92]
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Notes: Estimated alcohol-related nondomestic and domestic violence incidences were 154,666 and 40,791 in Australia in 2016, respectively. Estimated alcohol-related sexual violence was 46,736 in 2016. CI = confidence interval.

a

The calculation of mean cost of each harm item is elaborated in Appendix–Section 7.

b

Mean costs of lost output were collected from report of counting the costs of crime in Australia (Smith et al., 2011).

c

Costs of time spent calling police and seeking counseling services and cost of personal belongings damage for sexual violence attributable to others’ drinking were not measured in the alcohol's harms to others survey.

In total, AUD$5.2 billion was spent on child protection services in Australia in 2016–2017 (Steering Committee for the Review of Government Service Provision, 2018), and 31% of all child protection cases were alcohol attributable. The estimated cost of services in the child protection system because of an adult caregiver's drinking was thus $1.61 (0.31 × 5.2) billion in Australia.

Estimated costs of health-related quality-of-life loss attributable to others’ drinking

Results from the AHTO survey indicated that more than two thirds of the adult population reported having been adversely affected in the last year by someone else's drinking: 16% of Australians have been affected by the drinking of someone they live with or are intimate with; more than 40% of respondents reported that they had been threatened, physically assaulted, or had their property or belongings damaged as the result of a stranger's drinking; respondents who were harmed by others’ drinking reported significantly lower QOL than those who were not affected by others’ drinking at all. The apparent effects on respondents’ QOL are summarized in Table 3, which shows that others’ drinking appeared to reduce victims’ QOL by a total value of AUD$7.99 billion.

Table 3.

The economic impacts of problematic drinkers on other people's health and well-being 2008 (values in 2016 prices, in Australian dollars)

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Type of harms N in survey sample & weighted prevalence (%) Mean QALY scores [95% CI] Change in mean QALY scores [95% CI] Mean cost per person ($) N in Australian total population ages ≥18 in 2008 Intangible cost attributable to others’ drinking ($million) [95% CI]
Affected by family, relatives, friends and co-workers’ drinking
 Not affected 1,949 0.864 [0.853, 0.874] - 11,071,995 -
 A little 475 (17.93%) 0.850 -0.014 [0.831, 0.869] 833.00 [-0.022, -0.005] 2,700,565 [297.50, 1309.00] 2,249.57 [803.42, 3535.04]
 A lot 208 (7.85%) 0.788 [0.754, 0.822] -0.076 [-0.099, -0.052] 4,522.00 [3094.00, 5890.50] 1,183,996 5,354.03 [3663.28, 6974.33]
Subtotal (known drinkers) - - - - - 7,603.60 [4466.70, 10,509.37]
Affected by strangers’ drinking onlya
 Not affected 1,576 0.862 [0.852, 0.872] 8,955,980
 A littleb 557 (36.32%) 0.864 [0.642, 0.886] 0.002 [-0.021, 0.014] 0 3,609,559 0
 A lot 33 (4.08%) 0.832 [0.749, 0.915] -0.030 [-0.103, 0.043] 1,785.00 [0, 6128.50] 213,852 381.73 [0, 11310.59]
Subtotal (strangers) - - - - - 381.73 [0, 11310.59]
Total cost (known drinkers + strangers) 7,985.33 [4466.70, 11819.96]
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Notes: Total sample size N = 2,632 with 17 missing values. A threshold value of $50,000/QALY was applied. QALY = quality-adjusted life-years; CI = confidence interval.

a

To avoid any overestimation, this analysis only included respondents who were affected by strangers’ drinking and excluded respondents affected by known drinkers.

b

Values converted to $0 as the difference in QALY scores is positive.

Estimated costs of informal caregiving attributable to others’ drinking

Table 4 shows that of the 2,649 respondents, 778 reported spending extra time on caring for known drinkers and their dependents (e.g., cleaning up after drinkers’ drinking, driving them somewhere or picking them up, and looking after their children or other dependents) in the last 12 months. A total of 59 respondents reported that they had worked extra hours because of coworkers’ drinking (detailed analyses in the Appendix, Section 8). The total estimated cost of loss of productivity because of spending time looking after known drinkers and their dependents was AUD$2.93 billion, and the estimated cost of productivity loss attributable to coworkers’ drinking was $414.98 million.

Table 4.

Economic cost of informal caring and working extra hours due to known drinkers and strangers’ drinking in 2008 (cost values in 2016 prices, in Australian dollars)

graphic file with name jsad.2022.83.512tbl4.jpg

Type of harms N in AHTO survey sample & weighted prevalence (%) Annual mean productivity loss per person ($) [95% CI] Projected N in employed population ages ≥18 in Australia in 2008 Cost of productivity loss ($million) [95% CI]
Taking extra time caring for known drinkers and their dependents 778 (29.37%) 898.55 [550.54, 1246.56] 3,255,324 2,925.08 [1792.19, 4057.95]
Working extra hours because of coworkers’ drinking 59 (2.23%) 1,069.70 [794.67, 2016.03] 387,940 414.98 [308.28, 782.10]
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Notes: Total sample size N = 2,649; known drinkers included family, relatives, friends, coworkers, or neighbors who were known to the respondents. Please see Appendix–Section 8 for more details. AHTO = alcohol's harms to others; CI = confidence interval.

Estimated out-of-pocket cost and costs of property damage attributable to others’ drinking

The extrapolated out-of-pocket cost in the last year attributable to known drinkers’ drinking was AUD$1.01 billion (Table 5). The estimated costs of damage to property and to personal belongings attributable to strangers’ drinking were AUD$3.71 billion and $415.27 million, respectively.

Table 5.

Economic cost of damage to property and personal belongings and out-of-pocket cost in 2008 (cost values in 2016 prices, in Australian dollars)

graphic file with name jsad.2022.83.512tbl5.jpg

Type of harms N in AHTO survey & weighted prevalence(%) Average cost per affected person incident in a year ($) [95% CI] Projected N in population age ≥18 in Australia Total out-of-pocket/replacement and repair cost for Australia in a year ($million) [95% CI]
Out-of-pocket costs attributable to known drinkers’ drinking 729 (27.52%) 242.82 [105.43, 380.22] 4,140,240 1,005.34 [436.49, 1574.20]
Property damage attributable to stranger's drinking 262 (9.89%) 1,452.65 [752.83, 2153.79] 1,503,403 3,712.67 [1924.07, 5504.61]
Personal belongings damage attributable to stranger's drinking 149 (5.62%) 197.30 [118.26, 276.22] 841,905 415.27 [248.91, 581.38]
Total — — — 5,133.29 [2609.48, 7660.19]
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Notes: Total sample size N = 2,649; known drinkers included family, relatives, friends, coworkers, or neighbors who were known to the respondents. Please see Appendix–Section 8 for more details. AHTO = alcohol's harm to others; CI = confidence interval.

Estimated costs of social and health services use attributable to others’ drinking

The AHTO survey results show that about 13% of respondents called police when they were harmed by others’ drinking, and smaller proportions had used national DirectLine, health and AOD services, and other counseling or professional services to cope with the burden experienced because of others’ drinking. The estimated national cost of time spent by people seeking services was AUD$573.55 million, converted to 2016 Australian dollars, and the annual out-of-pocket costs for various health and social services was $130.62 million (Table 6). It was estimated that $2.10 million was allocated by the Australian Government to DirectLine ($0.37 million) and AOD services ($1.73 million) to deal with/treat people who had been affected by others’ drinking.

Table 6.

Cost of police, health/social services provided to people seeking services because of someone else's drinking (cost values in 2016 prices, in Australian dollars)

graphic file with name jsad.2022.83.512tbl6.jpg

Type of harms Prevalence of services use Mean cost per case ($) [95% CI] Total national cost ($million) [95% CI]
Cost of time spent by people seeking services because of the drinking of others 2008a
 Calling police 13.00% 4.63 [3.45, 5.83] 146.82 [109.12, 184.43]
 Hospital admission/ED attendance 1.30% 74.05 [0, 161.41] 226.39 [0, 493.6]
 Seeking other medical treatment 0.90% 57.53 [0, 145.13] 130.24 [0, 328.78]
 Seeking counseling/professional advice 3.00% 9.62 [5.94, 13.31] 70.10 [43.00, 96.90]
Subtotal - 573.55 [152.13, 1103.71]
Out-of-pocket expenses experienced by people using services because of the drinking of others 2008a
 Hospital admission/ED attendance 1.30% 161.76 [0, 417.54] 30.60 [0, 78.90]
 Seeking other medical treatment 0.90% 304.74 [0, 773.99] 42.72 [0, 108.36]
 Seeking counseling/professional advice 3.00% 127.41 [71.32, 184.59] 57.31 [32.11, 82.98]
Subtotal - 130.62 [32.11, 270.25]
AOD service treatment provided to people concerned about others’ drinking in 2016-2017b 701.80 1.73
National estimate of total resources allocated by DirectLine to answer calls from people who are concerned about someone's drinking in 2016c 29.37 0.37
Total cost - - 706.27 [186.33, 1376.05]
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Notes: Total sample size N = 2,649.

a

Result was drawn from the employed cases in the AHTO (Alcohol's Harm to Others) survey 2008 and detailed calculation was elaborated in Appendix–Table A8.6.

b

In 2016–2017, 7,720 AOD treatment episodes were delivered to people concerning others’ alcohol and other drugs use (i.e., amphetamines, cannabis and heroin, and ices), of which 32% of treatment episodes (n = 2,470) was related to others’ alcohol use only.

c

National cost was extrapolated from Victorian state estimation using the VIC proportion (0.256) of the population in Australia in 2016. CI = confidence interval; ED = emergency department; AOD = alcohol and other drugs.

A summary of estimated costs of others’ drinking

The overall total cost to society was AUD$19.81 billion (95% CI [11.99, 28.34]). The total direct and indirect tangible costs and intangible costs of AHTO were $11.13 billion (95% CI [6.74, 15.93]), $0.32 billion (95% CI [0.19, 0.46]), and $8.36 billion (95% CI [5.06, 11.97]), respectively (in 2016 prices) (Table 7).

Table 7.

A summary of economic costs among different tangible and intangible harms attributable to others’ drinking in Australia in 2016

graphic file with name jsad.2022.83.512tbl7.jpg

Cost and harm items Types of harms attributable to others’ drinking Year of data PAAF of harms attributable to others’ drinking Extrapolated number of casesa PYLL CPI adjusted Cost per case/PYLL in 2016 price ($) Total costs ($million)
Direct tangible costs Health care systemb Child assault & abuse 2016-2017 27.00% 175 - No 2,030.00 0.66
 Hospitalizations Child road crash 2016-2017 9.90% 585 - No 5,541.00 3.24
Adult assault 2016-2017 42.90% 10,035 - No 5,541.00 55.6
Adult road crash 2016-2017 10.40% 2,579 - No 5,541.00 14.29
Domestic violence 2016 2.52% 1,028 - No 11,600.00 11.92
Nondomestic violence 2016 2.52% 6,511 - No 11,600.00 45.21
 ED presentations Domestic violence 2016 4.21% 2,745 - No 1,313.81 1.35
Nondomestic violence 2016 4.21% 10,409 - No 1,313.81 8.55
 AOD treatment & services Episodes were delivered to people concerning others’ alcohol use 2016-2017 32.00% 2,470 - No 695 1.73
 Other medical treatment Domestic violence 2016 16.47% 6,718 - No 1,313.81 8.83
Nondomestic violence 2016 16.47% 25,473 - No 1,313.81 33.47
Sexual violence 2016 1.09% 2,205 - No 580 1.28
Social servicesb -
 Counseling, advice & Help Line services DirectLine service 2016 - 12,621 No 29.3 0.37
 Child protection and family services system Child protection and family services 2016-2017 31.00% $5.2 billion - No - 1,610.00
Property and personal belongings damage and other out-of-pocket expenses Out-of-pocket costs attributable to known drinkers’ drinking 2008 27.52% 4,140,240 Yes -1.19 242.82 1,005.33
Property damage attributable to known drinkers’ and strangers’ drinking 2008 9.89% 2,555,785 Yes -1.19 1,452.65 3,712.66
Personal belongings damage attributable to known drinkers’ and strangers’ drinking 2008 5.62% 2,104,763 Yes -1.19 197.3 415.27
Personal belongings damage from alcohol-related violence 2016 5.60% 10,946 No 217.86 2.38
Time spent seeking for social services Time spent calling police 2008 13.00% 1,956,758 - Yes 111.98 -1.19 219.12
Time spent seeking hospital and ED services 2008 1.30% 195,676 Yes -1.19 1,788.81 350.03
Time spent seeking medical services 2008 0.90% 135,468 Yes-1.19 1,389.71 188.26
Time spent seeking counseling services 2008 3.00% 451,559 Yes -1.19 232.57 105.02
Time spent caring for others Informal caregiving to drinkers and drinker's dependents 2008 29.37% 3,255,324 Yes -1.19 898.55 2,925.08
Working extra hours Take extra work responsibility because of coworkers’ drinking 2008 2.23% 387,940 Yes -1.19 1,069.70 414.98
Subtotal 11,134.65
Indirect tangible costs Loss of productivity b Adult assault injuries 2016 41.70% 10,035 - No 757 7.6
Adult road crash injuries 2016 10.40% 2,579 - No 1,163.00 3
Alcohol-related domestic violence injuries 2016 100.00% 40,791 - No 1,136.68 46.37
Alcohol-related nondomestic violence injuries 2016 100.00% 154,666 No 1,136.68 175.81
Sexual violence 2016 23.00% 46,736 - No 1,800.00 84.12
Subtotal 316.89
Intangible costs Premature deathb Child assault & abuse 2016 27.00% 6 185 No 70,018.00 12.95
Child road crash 2016 20.00% 13 360 No 70,018.00 25.21
Adult assault 2016 41.70% 92 2,153 No 70,018.00 150.75
Adult road crash 2016 14.10% 110 2,648 No 70,018.00 185.41
Lost quality of life Harmed a little by known drinkers’ drinking 2008 17.93% 2,700,565 - Yes -1.19 833 2,249.57
Harmed a lot by known drinkers’ drinking 2008 7.85% 1,183,996 - Yes -1.19 4,522.00 5,354.03
Harmed a little by strangers’ drinking only 2008 36.32% 3,609,559 - Yes -1.19 0 0
Harmed a lot by strangers’ drinking only 2008 4.08% 213,852 Yes -1.19 1,785.00 381.73
Subtotal 8,359.64
Total cost 19,811.21
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Notes: If the year of data is 2016 or 2008, it is a single calendar year. If the year of data is 2016–2017, it is a financial year (1 July 2016 to 30 June 2017). PAAF = population-level alcohol-attributable fractions; PYLL = person-years of life lost; CPI = consumer price index; ED = emergency department.

a

No extrapolated number of cases for child protection and family services system attributable to others’ drinking. Instead, the total government expenditure on child protection and family services system was reported as $5.2 billion in 2016–2017.

b

Most of these costs were paid by the Australian government, employers, and society.

Discussion

This study applied secondary agency or registry data and population survey data to provide an approximation of the economic costs that alcohol use causes to others in Australia. The total cost of harm due to others’ alcohol consumption in Australia was large in 2016, including a cost of AUD$2.48 billion to the Australian government and society (including costs to health and social services, loss of productivity, and costs of premature deaths) and $17.33 billion to private individuals in the general population. The tangible cost of harm attributable to others’ drinking was $11.45 billion, which equals 0.68% of the nation's gross domestic product ($1,672 billion) in 2016. Our study provides a new framework for estimating the costs of harms attributable to others’ drinking. AHTO cost $186.14 million in 2016 to the health care system in Australia, including costs to hospitals, emergency departments, AOD treatment, and other medical services providers. It is worth noting that the total intangible cost ($8.36 billion) was slightly lower than the total tangible cost estimate ($11.45 billion) attributable to others’ drinking.

Our cost estimates suggest that the burden to others from drinking is of the same general magnitude as the burden that drinkers impose on themselves and on response agencies serving them. This distinguishes alcohol from tobacco, where the burden of health harm to the smoker is much greater than the burden of secondhand smoke (Greenhaugh et al., 2020). It makes a strong case for an active role of governments in reducing burdens that drinking causes to nondrinkers or bystanders, including active intervention in alcohol markets to reduce these externalities. Even politically conservative small-government advocates would concede that governments have a role in remedying the market imperfections that create these externalities.

Costs of alcohol were broadened in our study to include government expenditures on the child protection system; the adverse effects of drinking of the household/family member or friend most affecting representative respondents; property damage by a stranger's drinking; counseling, advice, and treatment expenses for respondents affected by others’ drinking; and loss of QOL among people adversely affected by others’ drinking. Given the available data, our study used data from different years for harm to others and harm to drinkers and response agencies. The estimates can be considerably improved by a new study with data from a single time, estimating the tangible and intangible costs for both drinkers and others who were harmed by drinkers with data from the same year.

A debated issue in economic studies is whether the household or the individual should be the unit of analysis (Bhattacharya, 2017). Although the existing studies on the costs of alcohol use in Australia (Collins & Lapsley, 2008; Manning et al., 2013) do not discuss this explicitly, their discussion of private, and thus excluded, costs is couched in terms of the individual and the consumer. This implicitly excludes from the accounting the impacts on other members of the household. The position that costs to other members of the family from a member's choices should not be counted is not consistent with current social values. Most recent cost-of-illness studies do not take this position (Access Economics, 2007; Bouchery et al., 2011; Effertz et al., 2017; Matzopoulos et al., 2014; Thavorncharoensap et al., 2010). It is worth noting that our cost estimation shows the costs to private individuals or households attributable to others’ drinking is large (AUD$18.1 billion, and 89% of total costs of AHTO) and much greater than the costs to the government or society attributable to others’ drinking in Australia. There were some government costs that we were unable to collect, such as for incarcerations, and presumably public health insurance, research, and prevention. Nevertheless, reducing people's heavy drinking may not only help to reduce harmful consequences but may also substantially reduce the economic costs to private individuals and households from others’ drinking.

The secondary data we had access to were limited, and the costs derived from secondary agency data constituted a small proportion (13%) of the overall costs of AHTO in this study; most of the costs of harms from others’ drinking were derived from the AHTO survey. At least for health system data, this reflects that the involvement of others’ drinking in the injury or other presenting problem is rarely asked about and recorded (Rehm & Room, 2009). Our estimates, although striking, are thus still conservative. There were many categories of alcohol-related harm for which it was not possible to estimate economic costs. When such data were not available, this study highlighted the data deficiencies and suggested appropriate research to fill the gaps rather than producing estimates based on unsubstantiated assumptions. For example, the costs of the drinking of others close to the person reporting were only estimated for the drinker whose drinking had most adversely affected the person reporting; the respondent could have experienced harms also from many other people's drinking—this is not captured. Moreover, many costs of adverse effects of drinking on children were not measured: nongovernmental costs were not included, and neither were government costs other than child protection services. Furthermore, because of data unavailability, the costs of fetal alcohol spectrum disorder, miscarriage, stillbirth, and underweight birth and the costs of research and public prevention initiatives, of police and criminal services, and of suffering from separation or divorce attributable to others’ drinking were not included in our study. These costs have been included in some previous cost studies on alcohol use (Miller et al., 2006; Navarro et al., 2011).

For the costs to private individuals or households attributable to others’ drinking, we had to rely on the AHTO survey, and the existing Australian AHTO survey was conducted in 2008. Additional limitations include the small cell sizes observed in our analyses of the AHTO survey (e.g., in Table 3). Only analyses with sufficient statistical power and reliability (cell sizes 30 or greater) were retained in the summary results. We used differences in QOL estimates for our cost estimation from the AHTO study, and note that the 95% CIs did overlap for a minority of estimates. To complement the survey data, more recent agency data (2016–2017) were collected to compute harms and costs attributed to others’ drinking. We observed that the underlying drinking patterns and alcohol's related harm rates have changed since 2008. For example, alcohol consumption in Australia has decreased gradually in the last decade (Australian Bureau of Statistics, 2019a); however, several alcohol-related harms have steadily increased (Laslett et al., 2015; Lensvelt et al., 2015, 2018). This may mean that the cost estimates based on the 2008 survey data may underestimate the harms from others’ drinking in more recent years. Although the estimate in this study is based on the most recent available data for each category, the estimate will need to be updated when more recent survey data are available.

A new AHTO study was conducted in Australia in late 2021 and will provide us with an opportunity to analyze changes in the harms and costs of alcohol use by others across the last decade. The AHTO study has stimulated parallel general population surveys in more than 20 countries around the world, including Brazil, Chile, New Zealand, Nigeria, Sweden, Swaziland, Thailand, the United Kingdom, the United States, and Vietnam (Laslett et al., 2019; Wilsnack et al., 2018). This international collaborative study means that our data sets and analyses will be able to be replicated and compared with those of many other countries around the world.

An important priority is for research on prevention and reduction of the harm that alcohol causes to persons other than the drinker. Preventing this harm is as cogent and urgent a public health goal as preventing harm to people from their own drinking. The main area in which this has been done to date is in drink driving. The coordinated cross-agency policies and actions that have substantially reduced drink driving casualties (e.g., International Technology Scanning Program, 2006) can serve as a model for actions to reduce other kinds of harm from others’ drinking. Alcohol control policies, such as raising taxes/prices or introducing a minimum unit price, controlling liquor outlet density, and brief intervention on heavy drinking, could not only reduce harms and costs to drinkers themselves, but may also reduce costs and the burden of alcohol use caused to people around the drinker. Developing frameworks for estimating these economic costs is a cornerstone for driving and monitoring reductions in AHTO.

Footnotes

This research was funded by National Health and Medical Research Council (NHMRC) Project Grant GNT1141325 and Australian Research Council (ARC) Linkage Project Grant LP190100698. Anne-Marie Laslett is funded by ARC DE190100329. The Alcohol's Harm to Others survey was undertaken from a grant received by the Foundation for Alcohol, Research and Education.

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