Potential employer benefits from a plan to remove lead pipes in Michigan

August 24, 2023

Source: Rhyan, et al Health Affairs, August, 2023 LINK Savings and costs in millions

Flint, Michigan suffered from high lead levels in the water of many homes after a change in its water supply in 2014, leading to a declaration of a national state of emergency. Lead is enormously toxic especially to infants and young children. Lead exposure causes loss of intelligence, learning disabilities, and behavioral problems, and has also been associated with increased likelihood of incarceration, decreased productivity, and increased likelihood of death. Researchers estimated that the economic value of reducing lead levels in young children to zero would be $84 billion annually. Lead in water pipes is a major source of lead exposure, although children are also exposed to lead in the home, air, and soil.

I still have memories of the pediatric unit of what was then Boston City Hospital filled with frightened toddlers getting intravenous chelation therapy for lead poisoning during my training. Avoiding lead exposure in the first place is far preferable to treating it. Even in their fourth decade, those who were poisoned by lead as children had lower IQs and lower occupational achievement.

An estimated 6-10 million homes, largely in the Midwest and Northeast, obtain water through lead pipes and the Bipartisan Infrastructure Law includes $15 billion for replacement of lead pipes. Researchers modeled the economic benefits of replacement of lead pipes in Michigan and found that total replacement of lead pipes over 10 years would cost about $1.6 billion, and lead to economic benefits of $4 billion - with breakeven in 2035 and net return on investment of 2.5:1. Almost a half million newborns would benefit through 2060. The analysis did not include potential savings from a decrease in crime based on lower blood lead levels in young adults.

Implications for employers:

-        About 90% of the societal savings from replacing lead pipes come from increased productivity and earnings, especially important as employers face labor shortages with progressively smaller workforces as baby boomers retire.

-        Medical savings from lead pipe removal were modest but still consequential at savings of over $300 per child who benefited from not being exposed to water transported in lead pipes.

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