It is important to distinguish between two estimates of direct healthcare costs:
1. Cost of diabetes healthcare
This is the cost element that is attributable to diabetes itself or to the complications of diabetes. It clearly includes the costs of hospital admissions and other healthcare episodes for diabetic ketoacidosis (diabetic coma), hypoglycaemia and other direct results of diabetes or its therapy. The healthcare costs of diabetic neuropathy, retinopathy and nephropathy are also usually included. It is less clear, however, how much of the costs of care for such things as a myocardial infarction or stroke in a person with diabetes should be attributed to diabetes per se.
2. Total cost of care for people with diabetes
The second cost estimate includes all episodes of care for people with diabetes - diabetes-related healthcare and also those of care in which the main reason for the encounter is apparently unrelated to diabetes. The latter would include, for example, surgery for appendicitis or hip replacement or treatment for breast cancer in people with co-existing diabetes.
This second estimate has at least two advantages. First, it sidesteps the need to decide whether, or to what extent, a condition is or is not related to diabetes and, second, it incorporates the impact which diabetes may have on the costs of care even for such conditions as appendicitis, hip replacement or breast cancer in people with co-existing diabetes.
Lengths of hospital stay may be longer if diabetes co-exists. Drug bills are likely to be larger, care in general will be more intense and rehabilitation more complex and thus more costly. If such overall cost estimates are used then the incremental (or 'extra') cost of diabetes is calculated by subtracting the average costs of care for a person without diabetes from those of a person with diabetes, preferably using age, sex and ethnicity matched estimates.
Costs may be calculated from the point of view of the state or the individual and family. These latter costs are sometimes termed 'out-of-pocket' expenditures. More and more studies are focusing on these personal costs of care and on the potential for economic issues to influence the quality of care which people receive.