This document presents a cost-benefit analysis of implementing mandatory MMR vaccination for children with non-medical exemptions in the US. It finds that total discounted benefits of vaccination would be $83.38 million from reduced healthcare costs, increased productivity, and other factors. Total costs are estimated at $30.88 million. Therefore, the benefit-cost ratio strongly favors vaccination, with a ratio of nearly 3 to 1. However, due to political opposition, implementing such a program in the US may not be feasible. The analysis provides national estimates of costs and benefits to support voluntary vaccination.

1. Mariana Navarrete M., Phillip Pless and Siyu Wang
M a y 2 0 1 5
Cost Benefit Analysis of MMR Vaccination
for Children under Non-Medical Exemption
in the United States

2. 2
EXECUTIVE SUMMARY ............................................................................................................ 3
INTRODUCTION .......................................................................................................................... 4
The Outbreak in Orange County............................................................................................................... 4
The Disputes Surrounding the MMR Vaccine.......................................................................................... 6
Standing .................................................................................................................................................... 7
Assumptions.............................................................................................................................................. 8
BENEFITS CALCULATION ........................................................................................................ 8
Healthcare Benefits................................................................................................................................... 8
Mortality Benefits ................................................................................................................................... 10
Parental and Children Productivity Benefits Calculations...................................................................... 10
Administrative Benefits .......................................................................................................................... 12
COST CALCULATIONS............................................................................................................. 15
Vaccine Costs.......................................................................................................................................... 15
Vaccine Wastage Costs........................................................................................................................... 15
Administrative Costs............................................................................................................................... 16
Adverse Reaction Costs .......................................................................................................................... 17
Parental Productivity Costs..................................................................................................................... 18
Parental Travel Costs .............................................................................................................................. 18
BENEFIT COST RATIO.............................................................................................................. 19
SENSITIVITY ANALYSIS ......................................................................................................... 20
Costs........................................................................................................................................................ 20
Benefits ................................................................................................................................................... 22
CONCLUSION............................................................................................................................. 24
BIBLIOGRAPHY......................................................................................................................... 26

3. 3
EXECUTIVE SUMMARY
Recent major measles outbreaks in California and other states have increased attention to the
risks of not vaccinating children. There has been a significant increase in the number of measles
cases in the United States in the past several years due to unvaccinated children. Children can
become exempt from the measles vaccine for medical and non-medical exemptions. Non-
medical exemptions are those for religious or philosophical reasons. As a result, this cost-benefit
analysis (CBA) estimates the costs and benefits of the measles vaccine for children exempted
from the measles vaccine for non-medical reasons. National standing is provided in this CBA to
this group of children. The number of children estimated to have non-medical exemptions is
79,749.
Benefits for the measles vaccine can be broken down into four categories: a) healthcare cost
savings; b) mortality aversion; c) parental and children productivity gains; and d) public-sector
administrative benefits. Each benefit category is discounted by 3.5%. Total discounted benefits
for each of these impact categories can be seen in Figure 1 below.
Figure 1: Discounted Benefits and Costs for the Measles Vaccine
Benefits
• Healthcare benefits- $43.38 million
• Administrative benefits- $13.63 million
• Mortality benefits- $12.56 million
• Productivity benefits- $13.81 million
• Total Benefits: $83.38 million
Costs
• Vaccine cost- $3.9 million
• Vaccine wastage cost- $0.19 million
• Administrative cost- $1.49 million
• Adverse reaction cost- $23.62 million
• Parental productivity cost-$0.52 million
• Parental travel cost- $1.16 million
• Total Costs: $30.88 million

4. 4
In addition to benefits, costs associated with implementing the measles program are also
calculated. Costs associated with implementing the MMR program include: a) vaccine costs; b)
vaccine wastage costs; c) administrative costs; d) adverse reaction costs; e) parental travel costs;
and f) parental productivity costs. The total estimated cost of implementing the measles program
is approximately $30.88 million. Total costs are also shown in Figure 1.
Implementing a MMR vaccination program for children with non-medical exemptions has high
positive net benefits. Benefits exceed costs by a nearly 3 to 1 ratio. Similar to other vaccination
programs, a vaccination program will be highly cost-effective. However, due to the U.S. political
system, a MMR vaccination program for children with non-medical exemptions is not likely to
be implemented in the United States.
INTRODUCTION
The Outbreak in Orange County
On January 5, 2015, the California Department of Public Health (CDPH) was notified about a
suspected measles case. The patient was a hospitalized, unvaccinated child, aged 11 years with
rash onset on December 28.1
The only notable travel history during the exposure period was a
visit to one of the two adjacent Disney theme parks located in Orange County, California. On the
same day, two other reports about four additional suspected measles cases of California residents
and two cases of Utah residents were filed, all of whom reported visiting one or both of the
aforementioned theme parks during December 17–20. These incidental cases led to a shocking
measles outbreak in California that infected 110 people by the end of February 2015. The
outbreak later became a multi-state one, contributing to a major part of the total number of
measles cases in 2015.
Unfortunately, the outbreak in Orange County is not anecdotal. The United States has already
experienced a record number of measles cases during 2014, with 668 cases from 27 states
reported to CDC's National Center for Immunization and Respiratory Diseases (NCIRD). This is
1
Zipprich, Jennifer, Kathleen Winter, Jill Hacker, Dongxiang Xia, James Watt, and Kathleen Harriman. 2015.

5. 5
the greatest number of cases since measles elimination was documented in the U.S. in 2000 (See
Figure 2.2
Figure 2. U.S. Measles Cases and Outbreaks by Year
Though investigation suggested that the original measles virus was likely to come from a person
who got infected overseas and brought the virus to Disneyland during a visit, the real problem
that triggered the outbreak seemed to be the lack of proper vaccination. According to CDC’s
Morbidity and Mortality Weekly Report, among the 110 cases in California, 49 (45%) were
unvaccinated while twelve of the unvaccinated patients were infants too young to be vaccinated.
Among the 37 remaining vaccine-eligible patients, 28 (67%) were intentionally unvaccinated
because of personal beliefs, either philosophical or religious. 3
Further investigation led to a
national debate on the utilization of the Measles, Mumps, and Rubella (MMR) vaccine-a vaccine
that has proven to be useful for preventing measles, mumps, and rubella for decades.
2
Measles cases and outbreaks. in Centers for Disease Control and Prevention [database online]. 2015 [cited April
20 2015]. Available from http://www.cdc.gov/measles/cases-outbreaks.html.
3
Zipprich, Jennifer, Kathleen Winter, Jill Hacker, Dongxiang Xia, James Watt, and Kathleen Harriman. 2015.
Measles outbreak—California, december 2014-february 2015. MMWR Morb Mortal Wkly Rep 64 (6): 153-4.

6. 6
The Disputes Surrounding the MMR Vaccine
Since being introduced in the 1960s, the MMR vaccine was considered a big breakthrough in
inhibiting both epidemics and the severe side effects caused by the three deadly diseases-
measles, mumps and rubella. It is proven to be specifically useful in the prevention of measles,
which has a transmission rate of 90% for a person who is not immunized to it. At the beginning
of 1990, most Western countries have reached a MMR vaccine coverage rate of over 95%,
lowering measles contraction to less than a hundred cases per year. However, a study that was
published in 1998 triggered mistrust on the side effects of MMR vaccination and thus began the
long disputes surround measles vaccination.
In 1998, a study by a British research group, led by principal author Andrew Wakefield, was
published in The Lancet. In this article a possible link between the MMR vaccine and autism was
suggested.4
The research documented 12 cases, in which previously normally developing
children suddenly lost their language and social skills and developed autistic symptoms together
with a bowel disease. Though the article did not suggest a causal relationship between the
vaccine and autism, it almost immediately became a strong reason for parents to not vaccinate
their children, as they viewed autism to be a terrifying diagnosis in a society rewarding social
and communicative skills. Wakefield’s research was criticized harshly by other medical
professionals, as almost no other medical research had suggested any connections between the
vaccine and autism. Nevertheless, the damage caused by the study seemed to be long-lasting.
Many parents have since then developed a suspicion to the side effects of vaccination and have
stopped vaccinating their children completely. This trust dilemma caused MMR vaccination
coverage in 2002 to be even lower than 1990. More than a decade of immunization work had
vanished.5
At the beginning of the 21st century, even though the MMR vaccine level has slowly recovered
to its pre-Wakefield levels, there are clear regional differences, and many regions are still under
the 90% coverage rate that are critical to achieve herd immunity--the reductions in unvaccinated
4
Wakefield, Andrew J., Simon H. Murch, Andrew Anthony, John Linnell, DM Casson, Mohsin Malik, Mark
Berelowitz, Amar P. Dhillon, Michael A. Thomson, and Peter Harvey. 1998. RETRACTED: Ileal-lymphoid-nodular
hyperplasia, non-specific colitis, and pervasive developmental disorder in children. The Lancet 351 (9103): 637-41.
5
Bragesjö, Fredrik, and Margareta Hallberg. 2011. Dilemmas of a vitalizing vaccine market: Lessons from the
MMR vaccine/autism debate. Science in Context 24 (01): 107-25.

7. 7
persons’ risk of contracting a disease due to the vaccination of others. For the United States in
particular, although the national vaccine coverage rate is over 95%, the 2014 CDC report shows
the discrepancies among states in vaccination coverage rates (See Figure 3).
Figure 3. MMR Coverage Rate for Kindergarten Children in the 2013-14 School Year
Standing
This report assesses the costs and benefits of eliminating philosophical and religious exemptions
of the MMR vaccine for kindergarten children. Standing is provided to children that are currently
not vaccinated due to these non-medical exemptions across the United States. More specifically,
this cost-benefit analysis (CBA) analyzes the costs and benefits associated to kindergarten-aged
children that currently qualify for non-medical exemptions across the United States. Children
currently exempted due to medical reasons are excluded from this CBA due to potential health
complications contracted from getting the MMR vaccination. National standing is provided for
this CBA as it updates prior estimates of costs and benefits of national vaccination programs and
are estimated to illustrate the costs and benefits associated with this policy implementation.6
6
Zhou, F., S. Reef, M. Massoudi, M. J. Papania, H. R. Yusuf, B. Bardenheier, L. Zimmerman, and M. M.
McCauley. "An Economic Analysis of the Current Universal 2-Dose Measles-Mumps-Rubella Vaccination Program
in the United States." The Journal of Infectious Diseases 189 Suppl 1, (May 1, 2004): S131-45. and Whitney,

8. 8
Costs, benefits, and net benefit calculations are presented for the estimated 79,749 kindergarten-
aged children who are unvaccinated due to philosophical and non-medical exemptions.
Assumptions
All impact categories for this CBA are undergirded by several assumptions. First of all, it is
assumed that vaccine prices remain constant over time. Secondly, all impact categories are
monetized using 2013 Consumer Price Index (CPI) information from the Bureau of Labor
Statistics. For many of the benefit categories, it is assumed that benefits accrue over a 40-year
time period and are discounted with a 3.5% discount rate. Finally, we assume that benefit accrual
begins at age 5 as we assume that all kindergarteners start at age 5 and benefits accrue until 45.
BENEFITS CALCULATION
Healthcare Benefits
The MMR vaccine has proven effective in preventing measles contraction. Thus, the healthcare-
related expenditures to treat measles and its complications are included as a benefit category in
our calculation. The benefit is comprised of two parts: 1) savings from treatment of measles; 2)
savings from treatment of four kinds of complications: minor complications, such as diarrhea,
otitis media (middle ear) infections, pneumonia and encephalitis.
We obtained the per-case treatment cost of measles from a 2008 study on the measles outbreak in
San Diego, which estimated the total treatment cost per measles case to be $1,3477
or $1,457.45
in 2013 dollars. The study did not break down the cost into outpatient visit and hospitalization,
thus we only use the per-case treatment cost as the total cost of healthcare for measles
contraction. The treatment cost per case for the four complications were obtained from a 2004
cost-benefit analysis on the MMR vaccination program in the U.S., converted to 2013 dollars.8
Cynthia G., Fangjun Zhou, James Singleton, and Anne Schuchat. "Benefits from Immunization during the Vaccines
for Children Program era—United States, 1994–2013." Mmwr 63, (2014): 352-355.
7 Sugerman, D. E., A. E. Barskey, M. G. Delea, I. R. Ortega-Sanchez, D. Bi, K. J. Ralston, P. A. Rota, K. Waters-
Montijo, and C. W. Lebaron. 2010. Measles outbreak in a highly vaccinated population, san diego, 2008: Role of the
intentionally undervaccinated. Pediatrics 125 (4) (Apr): 747-55.
8
Zhou, F., S. Reef, M. Massoudi, M. J. Papania, H. R. Yusuf, B. Bardenheier, L. Zimmerman, and M. M.
McCauley. "An Economic Analysis of the Current Universal 2-Dose Measles-Mumps-Rubella Vaccination Program
in the United States." The Journal of Infectious Diseases 189 Suppl 1, (May 1, 2004): S131-45. and Whitney,
Cynthia G., Fangjun Zhou, James Singleton, and Anne Schuchat. "Benefits from Immunization during the Vaccines
for Children Program era—United States, 1994–2013." Mmwr 63, (2014): 352-355.

9. 9
The study also provided the probability of occurrence and probability of hospitalization for
measles and the four complications, divided by two age groups due to the difference in the
likelihood of occurrence in different ages as well as the total hospitalization cost. Table 1 shows
the probability of occurrence and hospitalization while Table 2 shows the total costs of treatment
of measles and related conditions.
Table 1. Probability of Occurrence and Hospitalization for Measles and Its Complications, in %
Age Measles Minor
Complications
MC
Hos.
Otitis
Media
OM
Hos.
Pneumonia P
Hos.
Encephalitis E
Hos.
5-19 2.54 96.12 4.57 2.23 10.56 1.61 54.86 0.05 100
20-45 0.02 93.80 12.76 1.37 21.83 4.67 74.18 0.16 100
Hos.: hospitalization
Table 2. Per-case Treatment and Hospitalization Expenditures (USD$)
Measles Minor
Complications
Otitis Media Pneumonia Encephalitis
Treatment $1,457.45 $46.29 $74.35 $254.58 $1,556.39
Hospitalization N/A $3,384.71 $4,267.08 $18,139.02 $38,669.72
Healthcare savings from treating measles itself:
79,949× Pr 𝑀𝑒𝑎𝑠𝑙𝑒𝑠𝑂𝑐𝑐𝑢𝑟𝑟𝑒𝑛𝑐𝑒 ×𝑇𝑟𝑒𝑎𝑡𝑚𝑒𝑛𝑡𝐶𝑜𝑠𝑡
We calculated the savings for each age group and the total savings from treating measles is
estimated to be approximately $44.89 million.
Healthcare savings from treating complications is estimated by the following equation:
79,949× Pr 𝑀𝑒𝑎𝑠𝑙𝑒𝑠𝑂𝑐𝑐𝑢𝑟. × Pr 𝐶𝑜𝑚𝑝. 𝑂𝑐𝑐𝑢𝑟. ×{Pr (𝐻𝑜𝑠. )×𝐻𝑜𝑠. 𝐶𝑜𝑠𝑡 + (1
− Pr 𝐻𝑜𝑠. )×𝑇𝑟𝑒𝑎𝑡. 𝐶𝑜𝑠𝑡}
We calculated the savings for each complication and within each age group. The total savings
from treating measles complications is estimated to be approximately $12.15 million. The total
undiscounted healthcare savings are estimated to be approximately $57.03 million. After
applying a discount rate of 3.5%, the total estimated healthcare benefits are approximately

10. 10
$43.38 million. Note that we did not calculate the healthcare benefits from avoided hearing
impairment for certain measles triggered complications, as well as the long-term savings in
special education for the hearing impaired children due to lack of data availability. Thus, the
estimated healthcare benefits are likely to be underestimated.
Mortality Benefits
Studies have shown that measles contraction may lead to death. Thus, by getting vaccinated, we
expected to see a significant decrease in the probability of catching measles and subsequent
death. We used the 0.08% probability of death due to measles contraction based on the 2004
CDC cost-benefit study.9
Since our program is aimed at getting the cohort of kindergarten
children the MMR vaccine at age 5 and since cost and benefit estimates are projected over a 40-
year period, we calculated the value of statistical life based on $5 million over 40 years and
applied a 3.5% discount rate, which yields an annual value of life that is $234,100 per person.
The benefit of avoided mortality is then calculated as follows:
During age 5 to 19, we assume measles contraction and death occur at age 12 without the
vaccine, thus: Gain in life expectancy with vaccine=
79,949×2.54%×0.08%× 45 − 12 ×234,100 = $12,518,846.18 ($12.52 𝑚𝑖𝑙𝑙𝑖𝑜𝑛)
During age 20 to 45, we assume measles contraction and death occur at age 32 without the
vaccine, thus: Gain in life expectancy with vaccine=
7,949×0.02%×0.08%× 45 − 32 ×234,100 = $38,832.02 ($0.04𝑚𝑖𝑙𝑖𝑜𝑛)
The total benefit from extended life expectancy is estimated to be $12,557,678.2 ($12.56
million)
Parental and Children Productivity Benefits Calculations
Previous CBAs of the 2-dose MMR vaccination program have estimated parental and child
productivity gains associated with parents taking care of sick children. In order to estimate the
parental productivity gains associated with eliminating non-medical vaccination exemptions for
children, it is assumed that parents would take care of ill children with four common medical
conditions associated with measles contraction: a) minor complications such as diarrhea; b) otitis
9
Supra note 9

11. 11
media (middle ear) infections; c) pneumonia; and d) encephalitis. Productivity benefit
estimations are calculated assuming a two-parent/guardian household in which both parents
work. Benefit calculations assume that one parent will stay home to take care of a sick child.
Benefit calculations assume a two-parent household because approximately 61 percent of
children live in two-parent households as of 2013 while the share of two-parent households with
parents working is 59.1 percent.10
It is assumed that productivity gains are realized for parents
from ages 5-19.
Productivity gains for children are calculated separately from parental productivity gains.
Children’s productivity gains are calculated separately from parental productivity gains for two
reasons: a) the measles contraction rate decreases at age 20; and b) our cohort of children remain
unvaccinated for the duration of the time period covered for this CBA. Children are assumed to
start working at age 20 for reasons of time contiguity, although it is likely that some
unvaccinated children may not enter the labor market until a later age. Children’s productivity
gains are calculated for the same conditions as parental productivity gains.
In order to obtain the total productivity gains experienced by parents and children, probability
rates for measles, minor complications, otitis media infections, pneumonia, and encephalitis
contraction rates for unvaccinated children are gathered from the Centers for Disease Control
and Prevention (CDC).11
The probability rates of hospitalization and home care for each of these
conditions is also gathered in order to accurately reflect lost productivity time for parents. The
number of hospitalization and home care days for each associated condition is gathered and the
average daily wage rate is calculated from recent Bureau of Labor Statistics wage data. 12
To estimate the productivity gains for each associated medical condition, the averted
productivity benefits for persons requiring hospitalization and non-hospitalization for a particular
medical condition are calculated. For example, productivity benefits for averted pneumonia
10 Gretchen Livingston, “Less than Half of U.S. Kids Live in a “Traditional” Family”, Pew Research Center, last
modified December 22, 2014, http://www.pewresearch.org/fact-­‐tank/2014/12/22/less-­‐than-­‐half-­‐of-­‐u-­‐s-­‐kids-­‐
today-­‐live-­‐in-­‐a-­‐traditional-­‐family/.; U.S. Department of Labor, “Employment Characteristics of Families
Summary, U.S. Department of Labor, Bureau of Labor Statistics, last modified April 23, 2015,
http://www.bls.gov/news.release/famee.nr0.htm .
11
Supra note 9
12 “Databases, Tables, and Calculators by Subject”, US Department of Labor, Bureau of Labor Statistics, accessed
May 2, 2015, http://data.bls.gov/cgi-­‐bin/dsrv.

12. 12
contraction for each year would be modeled by the following equation for both parents and
children: Pneumonia productivity benefits=
79,749× Pr( 𝑀𝑒𝑎𝑠𝑙𝑒𝑠𝑂𝑐𝑐𝑢𝑟. )× Pr 𝑃𝑛𝑒𝑢𝑚𝑜𝑛𝑖𝑎𝑂𝑐𝑐𝑢𝑟. × Pr 𝑃𝑛𝑒𝑢𝑚𝑜𝑛𝑖𝑎𝐻𝑜𝑠. ×𝑟𝑒𝑐𝑜𝑣𝑒𝑟𝑦 𝑑𝑎𝑦𝑠×
𝑑𝑎𝑖𝑙𝑦 𝑤𝑎𝑔𝑒𝑠 + 79,749× Pr 𝑀𝑒𝑎𝑠𝑙𝑒𝑠𝑂𝑐𝑐𝑢𝑟. × Pr 𝑃𝑛𝑒𝑢𝑚𝑜𝑛𝑖𝑎𝑂𝑐𝑐𝑢𝑟. ×[1 −
Pr 𝑃𝑛𝑒𝑢𝑚𝑜𝑛𝑖𝑎𝐻𝑜𝑠. ]×𝑟𝑒𝑐𝑜𝑣𝑒𝑟𝑦 𝑑𝑎𝑦𝑠×𝑑𝑎𝑖𝑙𝑦 𝑤𝑎𝑔𝑒𝑠
Productivity benefits are calculated for other conditions the same way from ages 5 to 45 and total
benefits are calculated by adding the productivity benefits from all conditions. Productivity
benefits are discounted at 3.5% annually for the duration of the time period.
Table 3 shows discounted annual productivity benefits for a portion of the program. The total
discounted estimated productivity benefits for parents and children is estimated to be
approximately $13.81 million in 2013 dollars. Productivity benefits are largest for parents due to
discounting of future benefits and because children have a larger chance of contracting measles
between the ages of 5-19.
It is important to note that this estimation of productivity benefits likely underestimates the true
productivity benefits of implementing a MMR vaccine for children with non-medical
exemptions. First of all, the number of home and healthcare days needed for productivity gain
calculations were not available from the CDC or other reliable sources. Thus, the actual
productivity gains from averting measles itself are not available. Second of all, this CBA does
not consider potential wage differentials that may exist between adults who contract measles and
those who do not. It is possible that future adults who have been adversely affected by measles
may have lower productivity potential than adults without measles. Prior studies have estimated
the benefits from this wage differential—however, the number of assumptions that would have to
be made about future productivity would likely result in unreliable estimates.
Administrative Benefits
In addition to direct healthcare and productivity costs averted by a MMR vaccination program,
the opportunity cost of public health officials’ time is also averted with the elimination of non-
medical exemptions for the MMR vaccine. A large measles outbreak in 2008 in San Diego

13. 13
caused a substantial outlay of public resources need to investigate and contain the measles
outbreak there. A 2008 study that investigated this measles outbreak estimated the administrative
costs to include: a) the wages and salaries of public health officials; 2) administrative overhead;
3) laboratory testing costs; 4) MMR vaccinations used during the outbreak; and 5) travel costs of
public health officials investigating the outbreak. The San Diego County Health and Human
Services and California Department of Health estimated that it took 1,745 hours to investigate
and contain the outbreak for a public-sector cost of $10,376 per measles case.13
It is likely that eliminating the non-medical exemptions for the MMR vaccine will reduce the
number of measles outbreaks in the United States. Because public officials’ time will not be
spent investigating measles outbreaks, officials’ time can be used to investigate other pressing
public health concerns.
In order to estimate the public-sector benefits associated with fewer measles outbreaks, the
estimate of the administrative benefits from California is used. This is the only estimate of
administrative benefits that is found in the literature. In addition to the administrative costs data,
the median annual number of measles cases reported is used. The CDC, based upon measles
outbreaks from 2001-2012, estimates that the median number of measles cases per annum is 60.14
Thus, estimated administrative benefits are calculated by multiplying the annual cases rate by the
administrative costs per case. The estimated undiscounted administrative benefits for one year
are approximately $724,000. Similarly to productivity benefits estimates, administrative benefit
calculations are discounted at 3.5% annually. Total discounted administrative benefits are
estimated to be approximately $13.63 million. Table 5 below provides a breakdown of
administrative benefits.
13
David E. Sugarman, Albert E. Barskey, Maryann G Delea, Ismael R. Ortega-Sanchez, Daoling Bi, Kimberly J.
Ralston, Paul A. Rota, Karen Waters-Montijo, and Charles W. Lebaron, “Measles Outbreak in a Highly Vaccinated
Population, San Diego, 2008: Role of the Intentionally Vaccinated”, Pediatrics 125, no. 4 (2010) : 747-755. DOI:
10.1542/peds.2009-1653.
14
Gregory Wallace, Susan Redd, Jennifer Rota, Paul Rota, William Bellini, and Emmaculate Lebo, “Measles-
United States, January 1-August 24, 2013”, Centers for Disease Control and Prevention, last modified September
13, 2013, http://www.cdc.gov/mmwr/preview/mmwrhtml/mm6236a2.htm .

14. 14
This estimate of administrative benefits is likely to be an upper bound estimate for several
reasons. First of all, San Diego and California specifically have higher costs of living than
outbreaks in other states. San Diego is the 4th
most expensive housing market in the United States
in 2014.15
Because employers have to compensate workers for higher living costs, average wages
paid to public health officials in San Diego and California are higher than those paid to workers
in other parts of the United States. Thus, administrative benefits are likely to be on the higher
end than for other benefits calculated in this CBA.
Table 3: Parental and Children Productivity Gains from the MMR Vaccination
Age Measles Contraction Rate Undiscounted Benefits
5-19 2.54% $1,366,390.52
20-45 0.02% $10,962.17
Table 4: Home Care and Hospitalization Days and Wage
Minor Complications Otitis Media Pneumonia Encephalitis
Hospitalization Days 2.33 3.4 9 15.7
Home Care Days 3.5 4 4.5 N/A
Table 5: Administrative Benefits of the MMR Vaccination
Age Median Measles Outbreak Rate Undiscounted Benefits
5-45 60 cases per year $723,920.40
15 Andie Adams, “San Diego is 4th Most Expensive U.S. City”, last modified October 14, 2014,
http://www.nbcsandiego.com/news/local/San-­‐Diego-­‐Is-­‐4th-­‐Most-­‐Expensive-­‐US-­‐City-­‐-­‐279089321.html

15. 15
COST CALCULATIONS
Vaccine Costs
We considered three kinds of costs for this program: costs associated with the purchase and
distribution of MMR vaccines, the costs of adverse reactions once the vaccine is administered
and related social costs. The costs of vaccines seem to be the most important category of all.
We take the number of kindergarten children under non-medical exemption in the 2013-14
school year from the Center of Disease Control and Prevention and break it down by the
proportion of vaccines administered by public and private providers, then we multiply it by the
market price of MMR vaccine, which results in $3.9 million dollars.16
It should be noted the
difference in vaccine price by type of provider as purchasing the MMR vaccine with a private
provider almost triples the cost of obtaining it in the public sector. We further discuss in the
sensitivity analysis the importance of the differences in proportion and in price for the overall
program. Moreover, the burden to the public sector for acquiring the vaccines for this program is
$315 thousand dollars (figure is rounded up on the table).
Table 6. Cost of Vaccines (USD$)
Number of Non Medical
Exemptions
Vaccines per type of
provider
Price of MMR
Vaccine (2013)
Total
(USD$ million)
79,749
80% private healthcare $56.14 $3.58
20% public healthcare $19.76 $0.32
$3.90
Vaccine Wastage Costs
We found in the literature some examples that included the cost of vaccine wastage. We
acknowledge that budgeting for a contingency is consistent with good practices in project
16
Seither, R., S. Masalovich, C. L. Knighton, J. Mellerson, J. A. Singleton, S. M. Greby, and Centers for Disease
Control and Prevention (CDC). "Vaccination Coverage among Children in Kindergarten - United States, 2013-14
School Year." MMWR.Morbidity and Mortality Weekly Report 63, no. 41 (Oct 17, 2014): 913-920. See Supra note
6 for the proportion by type for provider.

16. 16
management and with the fragile nature of vaccines. We use 5 percent of the total cost of
vaccines in order to calculate the cost of vaccine wastage.17
Then, 80 percent is assigned to the
private sector and the remaining 20 percent to the public sector, following the pattern of
consumption of vaccines we mentioned above. The cost of vaccine wastage is estimated to be
approximately $194 thousand dollars.
Table 7. Cost of vaccine wastage (USD$ million)
Vaccines per type of
provider
Total Vaccine
Cost
Vaccine Wastage
Average Rate
Total
80% private $0.32
5%
$0.18
20% public $3.58 $0.02
$3.90 $0.19
Administrative Costs
Table 8. Administrative Cost (USD$)
Number of Non Medical
Exemptions
Type of provider
Average
Fees
Vaccines per
type of provider
Total(USD$
million)
79,749
Private provider $18.05 80% $1.31
Medicaid $10.26 20% $0.19
$14.16 $1.49
Administrative costs include several activities from maintaining a vaccine inventory, paying
nurses that administer the vaccines, and the personnel running a clinic. This cost may be
transferred entirely or partially to the customer, and as we see the private fee associated with
getting a vaccine is 1.75 times the Medicaid fee. This is important, because administrative costs
as calculated below will add an additional 38.36 percent to the price of the MMR vaccine.
Although we do not have information on price elasticity for the MMR vaccine, the added
administrative cost should be taken into account by policymakers in order to assess the impact of
the quantity demanded and the overall success of the program.
17
Supra note 6.

17. 17
Adverse Reaction Costs
Table 9. Probability and cost associated with adverse reaction (USD$)
Disease
Probability
of
occurrence
Probability of
hospitalization
Nº of
hospitalization
days
Nº of
outpatient
visit
Cost of
hospitalization
Cost per
outpatient
visit
Minor reactions 0.1 0 0 0.02 - $79.54
Parotitis 0.016 1 3 0.1 $10,971.23 $153.27
Arthralgia/Arthritis 0.01 1 2 0.5 $11,596.37 $172.71
Febrile seizures 0.00033 10 2 1 $6,714.92 $517.69
Thrombocytopecnic
purpura 0.00003 40 4.8 5.91 $28,082.81 $515.21
Anaphylaxis 0.000001 100 2.89 2.06 $19,841.44 $188.96
Aseptic meningitis 0.000001 25 3 1.3 $23,406.04 $177.16
Encephalitis 0.000001 100 8.7 3.52 $36,442.55 $416.69
Thrombocytopenia
case fatality case 0.0000046 0 0 0 - -
Encephalitis case
fatality rate 0.00005 0 0 0 - -
Table 10. Cost of adverse reaction (USD$ million)
Number of Non Medical
Exemptions
All diseases
79,749 $23.62
Like any other medical treatment, vaccines may cause adverse reactions. We use the probability
of occurrence for ten diseases associated with the MMR vaccine, their probability of
hospitalization and the cost of hospitalization, we also use the average number of outpatient
visits and the cost of an outpatient visit in order to calculate the total cost of adverse reactions
expected for the kindergarten children under non-medical exemptions. Despite the minuscule
probabilities of the listed diseases, this cost is the largest category in this CBA, accounting for 80
percent of the total costs under the direct cost method, and for 76 percent under the indirect cost
method.

18. 18
Parental Productivity Costs
Under the indirect cost method, societal costs are taken into account. We decided to include the
cost associated to the parents of taking a child to get the MMR vaccine. We are assuming a
parent or guardian accompanies a child to get the vaccine, we also assume two hours on average
are sufficient to get the vaccine, and finally we equate the opportunity cost of the parent or
guardian as the average hourly wage. We use the average weekly wage from the Quarterly
Census of Employment and Wages published by the Bureau of Labor Statistics to calculate the
average hourly wage by assuming an average workweek of 40 hours. We multiply the dollar
amount by 2 hours in order to get the individual parental productivity cost (per vaccine). This
category represents 1.69 percent of the total indirect costs.
Table 11. Parental productivity cost (USD$)
Number of children under
Non Medical Exemption
Average
weekly wage
Average
hour wage*
Individual parental
productivity cost**
Total
79,749 $958 $23.95 $47.90 $521,822.60
*Assuming average week 40 hours **Assuming 2 hours average
Parental Travel Costs
We calculate the parental travel costs in an effort to capture more accurately the costs the parents
or guardians will face when taking their children to get their MMR vaccine. We proxy the
average travel time to a health provider facility with the average travel time to work for families
with children under 6 years published by the US Census (2009), then we multiply the miles by
the Private Own Vehicle (POV) mileage rates published by the US General Services
Administration (GSA) in January 2013. We would like to highlight that parental travel costs are
more than double the parental productivity costs, and as a result, the indirect costs increases.
Both parental costs represent 5.43 percent of the total costs when calculated under the indirect
method.

19. 19
Table 12. Parental travel cost (USD$)
Number of children under
Non Medical Exemption
Average Travel Time to
Work*
POV Mileage
Rates (Jan 2013)
Total
(USD$ million)
79,749 25.65 $0.57 $1.16
* For families with own children under 6 years. Variation from national average 2.2%
We would like to address some of the omitted cost categories in this CBA. Death is not included
in adverse reaction costs because we found in the literature that the probability is so close to zero
that it would not change the cost of adverse reactions for a program of the size analyzed in this
CBA. We are not including any data regarding tax or insurance reimbursement due to the lack of
information, but we recognize they may affect the total cost of the vaccine for consumers and the
quantity demanded in consequence. Likewise, we omit the cost of launching the program or
marketing campaign promoting the MMR vaccine for children under non-medical exemptions
for two reasons: first, it is likely to be negatively perceived by some citizens and interest groups
and could even be counterproductive to the public opinion. Second, we assume that the CDC
already has an organizational structure running other vaccine programs; therefore, the cost of an
additional program or campaign could be absorbed by the organization. We do not consider the
alternative of mobilizing labor force (doctors and nurses) belonging to the public sector in order
to administer the vaccine in school or public spots. Although, many vaccination programs around
the world are conducted under these conditions, it seems unlikely to happen in the U.S. Finally,
we omitted other forms of transportation when calculating the parental travel costs because we
lack information in order to properly cross-tabulate data from different databases containing the
frequencies of other forms of transportation with the frequencies of children under non-medical
exemptions.
BENEFIT COST RATIO
When we compute only the direct costs, the Benefit Cost Ratio is 2.85. Then, when considering
the social costs for the indirect cost method, the total cost raises by $1.6 million. This represents
an increase of 5.74 percent of the total direct costs. The net benefits of the MMR vaccine
program for children under non-medical exemption is $54.17 million when including only direct
costs. Despite the increase cost under the indirect cost method, the program will have a net

20. 20
benefit of $52.49 million. When including the indirect costs, the Benefit-Cost Ratio decreases to
2.70.
Table 13: Total Benefits and Costs
Benefits Costs (Direct Method) Costs (Indirect Method)
Helthcare Benefit $43.38 Vaccine Costs $3.90 Vaccine Costs $3.90
Mortality Benefit $12.56 Vaccine Wastage Costs $0.91 Vaccine Wastage Costs $0.91
Administrative Benefit $13.63 Administrative Costs $1.49 Administrative Costs $1.49
Productivity Benefit $13.81 Adverse Reaction Costs $23.62 Adverse Reaction Costs $23.62
Parental Productivity $0.52
Parental Travel $1.16
Total Benefits $83.38 Total Costs $29.21 Total Costs $30.88
SENSITIVITY ANALYSIS
Costs
We conducted a univariate sensitivity analysis for most cost categories, and then we compare
them to our base case. First, we assumed our program could cover the children under medical
exemptions, which increases the total of children by 10,894 kindergartens, to a total of 90,543
recipients of MMR vaccines. When we calculate that, the total cost of our program goes up by
$532 thousand dollars and the benefit-cost ratio diminishes minimally. We would like to
highlight that children under medical exemption are more likely to have a different set of
probabilities of occurrence for adverse reactions.
If the public sector were to purchase and administer all the vaccines needed, it would result in
potential savings for the program of $2.3 million in the purchase of vaccines and $496 thousand
in administrative fees. This condition causes the benefit cost ratio to reach its maximum ratio of
3.41 when considering direct costs and 3.21 when considering indirect costs.
Likewise, when we assume a 50/50 distribution per type of provider we see the total cost
diminishes in $870 thousand due to vaccine price and $186 thousand due to administrative fees.

21. 21
On the contrary, purchasing all the vaccines for the program in the private sector will raise the
total cost by $580 thousand due to vaccine prices and $124 thousand in administrative fees. This
assumption caused the benefit-cost ratio to reach a minimum in this sensitivity analysis.
Table 14:Changes to total costs: univariate sensitivity analysis (USD$ million)
Parameter
Direct
cost
method
Indirect
cost
method
Increase/decrease in
total cost (USD $)
Base case 3.14 2.97 -
Program cover children under medical
exemption 3.08 2.92 $532,313.52
100 percent of vaccines from public sector
Cost of vaccines 3.41 3.21 $2,321,009.08
Administrative cost 3.21 3.04 $676,442.69
50/50 percent from public sector and private sector
Cost of vaccines 3.24 3.06 $870,378.40
Administrative cost 3.18 3.00 $365,955.88
100 percent of vaccines from private sector
Cost of vaccines 3.08 2.91 $580,252.27
Administrative cost 3.15 2.97 $124,194.72
Vaccine wastage (3%) 3.15 2.98 $77,935.31
Vaccine wastage (10%) 3.12 2.95 $194,838.28
Cost of adverse reaction plus estimated US inflation*
Estimated inflation 2016: 1.48 percent 3.10 2.94 $349,568.46
Estimated inflation 2017: 2.37 percent 3.08 2.92 $559,781.92
Parental productivity cost plus estimated US
inflation*
Estimated inflation 2016: 1.48 percent 3.14 2.97 $7,722.97
Estimated inflation 2017: 2.37 percent 3.14 2.97 $12,367.20
Parental travel cost plus estimated US inflation*
Estimated inflation 2016: 1.48 percent 3.21 3.03 $17,104.95
Estimated inflation 2017: 2.37 percent 3.21 3.03 $27,391.03
*According to the International Monetary Fund

22. 22
Reducing vaccine wastage to 3 percent would allow a modest saving of $77 thousand in total
cost. On the contrary, if the vaccine wastage goes up to 10 percent, the total cost will increase in
$194 thousand dollars. We used the estimated inflation for 2016 and 2017 in order to calculate
potential increments for cost of adverse reaction, parental productivity cost and parental travel
cost. We did not compute any decrease in cost for those categories because it seems unlikely to
happen. Because cost of adverse reactions is the largest cost category, even a small increment
will result in a high dollar value. In contrast, inflation will raise parental productivity cost and
parental travel cost by so little, that inflation will not have an effect on the benefit cost ratio
under the direct or the indirect method.
Benefits
We also conducted a sensitivity analysis on certain parameters of the benefits to test how
sensitive these benefits were to our calculations. First of all, the sensitivity of the productivity
benefits was tested by adjusting the hourly wage rate from $23.95 to $19.95, which is based
upon differences in reported Bureau of Labor Statistics data. This results in a lower daily wage
rate used to calculate productivity benefits for parents and children. Thus, the daily wage rate
decreases from approximately $192 to approximately $159 per day. After recalculating the
benefits, the discounted benefits estimate drops from $13.81 million to approximately $11.48
million, a difference of approximately $2.33 million. This is approximately a 16.9% decrease in
the aggregate productivity benefits. Making assumptions about the daily wage rate does change
the productivity calculations substantially.
We also examined the sensitivity of our administrative benefits calculation. The baseline case
calculation, as previously mentioned, is an upper-bound estimate of the administrative benefits.
Thus, we wanted to examine how adjusting the cost-of-living index would change the total
administrative benefits calculation. The administrative cost per case data is an estimate from an
outbreak in San Diego. Thus, we examined the difference in the cost-of-living between San
Diego and the average U.S. city. The most recent cost-of-living index information from 2010
from the Bureau of Labor Statistics shows that San Diego’s cost-of-living is 32.3% higher than
the U.S. average. Thus, we adjusted the administrative cost per case to the U.S. average. The
average administration costs then is approximately $9,120 per case. Recalculated administrative

23. 23
benefits fall from $13.63 million to $10.30 million, a drop of $3.33 million in administrative
benefits. This is almost a 25% drop in the net administrative benefits. Thus, cost-of-living
assumptions are important in the final administrative benefits calculation.
Moreover, we estimated the change in mortality benefits by adjusting the age of measles
contraction and death occurrence. Previously, we used the median age for both age groups, and
specifically, we assume death occurs at age 12 during ages 5-19, and at age 32 during ages 20-
45. However, based on medical evidence, measles contractions are more likely to occur at an
earlier time of life, usually before age 25. Thus, we adjusted the assumptions and recalculated the
mortality benefits. We assume that for ages 5-19, measles contraction and subsequent death
happens at age 5, and for ages 20-45, death happens at age 25. Keeping all else constant, the
recalculation shows an increase of $2.67 million in mortality benefits from $12.56 million to
$15.23 million.
Table 14 demonstrates the changes in the parameters above and their effects on total benefit
estimates. Overall total benefits decreased by $2.99 million after the sensitivity analysis.
However, the decrease in benefit does not have a large impact on the benefit-cost ratio.
Table 15:Changes to total benefits: univariate sensitivity analysis (USD$ million)
Parameter
Prior
Estimate
New
Estimate
Increase/decrease
in total benefits
Change hourly wage from $23.95 to $19.95
Productivity benefit 13.81 11.48 2.33
Change investigation cost from $10,376 to $9,120 per case
Administrative benefit 13.63 10.30 3.33
Change the ages of death occurrence into age 5 and age 25
Mortality benefit 12.56 15.23 2.67

24. 24
CONCLUSION
There are several limitations in our estimation of costs and benefits to society of the MMR
vaccination program. First of all, the administrative benefit calculations are likely an upper-
bound estimate due to cost-of-living differentials between San Diego and the average U.S. city.
Moreover, the estimated non-medical exemptions estimate may be under or over estimated due
to survey methodology variation among states. As the CDC has discussed, some states only
survey a sample of kindergarteners while other states conduct a full census to estimate the
number of children with non-medical exemptions. Earlier CBAs calculated productivity benefit
differentials between average U.S. workers and persons in special education. However, we did
not estimate the productivity benefit increase due to fewer persons in special education because
of major data problems. We also did not attempt to calculate healthcare cost savings for hearing
impairment in our CBA. Thus, our respective productivity and healthcare benefit calculations
may be substantially lower than benefit estimates if these benefits were calculated.
However, despite these limitations, eliminating the non-medical exemptions for the MMR
vaccine is extremely beneficial for society in averted healthcare, administrative, mortality, and
productivity expenses. Whether using the direct or indirect cost method, benefits outweigh the
costs of the program by nearly 3:1. This is an unsurprising finding as vaccination programs in the
U.S. tend to have large net benefits and are extremely cost-effective. Thus, from a cost-benefit
perspective, it makes sense for the United States to implement this program.
However, we also acknowledge that this program is not likely to ever be implemented in the
United States due to the foundations of the U.S. political system. Public opinion would likely be
strongly against a required vaccination program for previously exempted children due to
constitutional concerns around freedom of religion and free speech. Thus, this program is
unlikely to be implemented given these concerns.
Given the recent measles outbreaks in California and Ohio, continued and informed public
debate over the costs and benefits of the vaccination program are important for parents who are

25. 25
considering not vaccinating their children. A famous letter circulated by the famed British author
Roald Dahl implored parents of children in the 1960’s to ensure that their children be vaccinated
for measles and the potential consequences of not doing so. Thus, it is recommended that
policymakers continue to communicate with the American people on the significant benefits that
accrue as a result of the measles vaccination program and the significant health risks that parents
face if they choose not to get their children vaccinated.

26. 26
BIBLIOGRAPHY
"Measles Cases and Outbreaks." Centers for Disease Control and Prevention. Accessed April 20, 2015.
http://www.cdc.gov/measles/cases-outbreaks.html.
Adams, Andie. "San Diego is 4th most Expensive U.S. City." NBC News San Diego. Accessed April 24,
2015. http://www.nbcsandiego.com/news/local/San-Diego-Is-4th-Most-Expensive-US-City--
279089321.html.
Bragesjö, Fredrik and Margareta Hallberg. "Dilemmas of a Vitalizing Vaccine Market: Lessons from the
MMR vaccine/autism Debate." Science in Context 24, no. 01 (2011): 107-125.
Carabin, Hélène and W. John Edmunds. "Future Savings from Measles Eradication in Industrialized
Countries." Journal of Infectious Diseases 187, no. Supplement 1 (2003): S29-S35.
Centers for Disease Control and Prevention. "CDC Vaccine Price List." . Accessed 31 Mar., 2015.
http://www.cdc.gov/vaccines/programs/vfc/awardees/vaccine-management/price-list/.
Centers for Disease Control and Prevention (CDC). "Measles - United States, January 1-August 24,
2013." MMWR.Morbidity and Mortality Weekly Report 62, no. 36 (Sep 13, 2013): 741-743.
Hill, Marie C. and Carol L. Cox. "Influencing Factors in MMR Immunization Decision Making."
European Scientific Journal 9, no. 21 (2013).
Livingston, Gretchen. "Less than Half of U.S. Kids Today Live in a "Traditional" Family." Pew Research
Center. Accessed April 22, 2015. http://www.pewresearch.org/fact-tank/2014/12/22/less-than-half-
of-u-s-kids-today-live-in-a-traditional-family/.
MacDonald, PF. "The MMR Vaccine controversy—winners, Losers, Impact and Challenges." British
Journal of Infection Control 8, no. 1 (2007): 18-22.
Malone, Kevin M. and Alan R. Hinman. "Vaccination Mandates: The Public Health Imperative and
Individual Rights." Law in Public Health Practice (2003): 262-284.

27. 27
O'Leary, S. T., M. A. Allison, M. C. Lindley, L. A. Crane, L. P. Hurley, M. Brtnikova, B. L. Beaty, et al.
"Vaccine Financing from the Perspective of Primary Care Physicians." Pediatrics 133, no. 3 (Mar,
2014): 367-374.
Seither, R., S. Masalovich, C. L. Knighton, J. Mellerson, J. A. Singleton, S. M. Greby, and Centers for
Disease Control and Prevention (CDC). "Vaccination Coverage among Children in Kindergarten -
United States, 2013-14 School Year." MMWR.Morbidity and Mortality Weekly Report 63, no. 41
(Oct 17, 2014): 913-920.
Sugerman, D. E., A. E. Barskey, M. G. Delea, I. R. Ortega-Sanchez, D. Bi, K. J. Ralston, P. A. Rota, K.
Waters-Montijo, and C. W. Lebaron. "Measles Outbreak in a Highly Vaccinated Population, San
Diego, 2008: Role of the Intentionally Undervaccinated." Pediatrics 125, no. 4 (Apr, 2010): 747-
755.
———. "Measles Outbreak in a Highly Vaccinated Population, San Diego, 2008: Role of the
Intentionally Undervaccinated." Pediatrics 125, no. 4 (Apr, 2010): 747-755.
U.S. Department of Labor, Bureau of Labor Statistics. "Employment Characteristics of Families
Summary." Bureau of Labor Statistics. Accessed April 24, 2015.
http://www.bls.gov/news.release/famee.nr0.htm.
Wakefield, Andrew J., Simon H. Murch, Andrew Anthony, John Linnell, DM Casson, Mohsin Malik,
Mark Berelowitz, Amar P. Dhillon, Michael A. Thomson, and Peter Harvey. "RETRACTED: Ileal-
Lymphoid-Nodular Hyperplasia, Non-Specific Colitis, and Pervasive Developmental Disorder in
Children." The Lancet 351, no. 9103 (1998): 637-641.
Whitney, Cynthia G., Fangjun Zhou, James Singleton, and Anne Schuchat. "Benefits from Immunization
during the Vaccines for Children Program era—United States, 1994–2013." Mmwr 63, (2014): 352-
355.
Ye Hee Lee, Michelle. "Why did Obama's Budget Proposal Cut Federal Immunization Funding?"
Washington Post, February 9, 2015, 2015, sec. Fact Checker.
Zhou, F., S. Reef, M. Massoudi, M. J. Papania, H. R. Yusuf, B. Bardenheier, L. Zimmerman, and M. M.
McCauley. "An Economic Analysis of the Current Universal 2-Dose Measles-Mumps-Rubella

28. 28
Vaccination Program in the United States." The Journal of Infectious Diseases 189 Suppl 1, (May 1,
2004): S131-45.
Zhou, F., A. Shefer, J. Wenger, M. Messonnier, L. Y. Wang, A. Lopez, M. Moore, T. V. Murphy, M.
Cortese, and L. Rodewald. "Economic Evaluation of the Routine Childhood Immunization Program
in the United States, 2009." Pediatrics 133, no. 4 (Apr, 2014): 577-585.
Zipprich, Jennifer, Kathleen Winter, Jill Hacker, Dongxiang Xia, James Watt, and Kathleen Harriman.
"Measles outbreak—California, December 2014-February 2015." MMWR Morb Mortal Wkly Rep
64, no. 6 (2015): 153-154.