What Public Health Actually Delivers
Public health deserves to be spoken about in honest and nuanced terms. We at the Colorado Health Institute thought it was especially important to provide a more detailed look at these investments when government budgets are being squeezed. But before we share numbers, we need to discuss values that can’t be quantified in dollars.
Two things are true simultaneously.
First, public health can be successful without delivering cost savings at all. Many county governments have decided that disease prevention, access to nutrition, and safe water are worth paying for on their own terms. For them, health is the ROI.
Second, public health does have real budgetary value for policymakers — just perhaps not so dramatic as the $14 figure implies. By being honest about what public health delivers and to whom, there is still a case to be made that public health investment improves government balance sheets. It just requires some additional math.
A Complete Accounting
To paint a more complete picture of the ROI, CHI created an analysis that applied two constraints: limiting savings to a one-year time horizon and only counting savings that accrued to the same entity doing the spending. The former works on more manageable timelines, and the latter addresses what economists call the “wrong-pocket problem.”
The result is a first-of-its-kind analysis for Colorado, shown in Table 1. Our analysis focused on county public health spending because, in Colorado, these agencies provide the type of direct frontline services measured by ROI studies. State public health functions are crucial but belong in a different conversation.
Table 1. Local Public Health Spending and Saving in Government Budgets, One Year Time Horizon*
| Level of Government | Local Public Health Spending | Total Return | Net | One-Year ROI for Government Budget |
| Colorado Counties | $98M | $0 | -$98M | 0 |
| State of Colorado | $91M | $120M | $29M | 1.3 |
| Federal Government in Colorado | $129M | $346M | $217M | 2.7 |
| Total Government | $318M | $466M | $148M | |
*Dollar amounts reflect FY2023-24 public funding only and do not capture the full public health budget, which also includes grants, clinical fees, and more.
For local public health, the most surprising finding might be the ROI of zero at the county level. But it makes sense; counties in Colorado generally don’t pay for the types of services that public health spending most directly reduces, such as hospitalizations or chronic disease management. Those savings flow to Medicaid, Medicare, private insurers, providers, and patients.
What counties do capture is real, but diffuse. Even in the first year, local employers benefit from reduced absenteeism, and the broader economy enjoys a healthier workforce, consumer base, and safety standards. But these returns don't hit the county ledger directly.
State and federal governments are in a different position. Because they fund Medicaid and Medicare, they do see measurable fiscal returns within a single year.
On net, government’s $318 million local public health investment results in savings to federal, state, and local budgets to the tune of $148 million in Colorado, even in a single year. But behind that figure is an imbalance. County dollars flow out, and savings often land in federal and state treasuries.
Implications of a Revisited ROI
These findings carry two implications worth thinking through.
The first is for state and federal policymakers, whose budgets are the primary fiscal beneficiaries of local public health activity. Both levels of government see positive returns within the first year. This does not mean infinite spending on local public health will result in infinite savings — the positive returns are bound to plateau at some point. But this has not happened at funding levels seen in the past few decades. Reducing state and federal funding for local public health is unlikely to improve the bottom line for state and federal budgets. In fact, the data suggest the opposite.
The second implication, and perhaps a more fundamental one, is that it may be time to stop asking county public health spending to justify itself on fiscal criteria it was not designed to meet and instead focus on the social returns it genuinely delivers. These “government expenditures” are taxpayer money, after all, and taxpayers receive a benefit from public health spending. With a long enough time horizon and a broad enough lens, something close to the 14:1 ratio still holds. The economic activity is real. The health outcomes are real. Counties are investing in something that makes their communities better — no matter whose budget the dollars show up in. It might seem that these implications come from competing ways of thinking about the ethics of public spending. On the one hand, perhaps public investments don’t require direct financial returns the same way a stock portfolio might. They are efforts a community undertakes for the betterment of ourselves and those around us. On the other hand, people who actually create budgets are generally working with fixed amounts, where every dollar allocated is a dollar not spent elsewhere. Stewards of public funds need accurate information to properly weigh the tradeoffs.
A more complete accounting of the return on investment in public health can inform both of these discussions. Getting it right is how public health makes its case to both the idealist and the budget officer in the room.
