Introduction
Mass vaccination implies the distribution of free vaccines to the population preventing the spread of the virus. The policy aims to mitigate the economic downturn presented by the prevalence of Covid-19 across the globe. The research demonstrates that it is possible to create a sufficient number of medications to vaccinate all people on Earth (Chau, 2021). At present, the situation concerning the virus is still highly relevant; therefore, mass vaccination is a financially beneficial investment in the long term. Furthermore, the studies indicate that the costs of vaccine distribution are less detrimental to the national economies than the negative health consequences of the virus (Chau, 2021). The cost-benefit analysis might reveal the benefits of implementing a particular strategy to the country’s financial situation (Enthoven, 2019). Therefore, it is essential to thoroughly examine mass vaccination, including estimated costs, benefits, discount rates, and social advantages.
Assumption
The hypothetical scenario includes a country with a population of over 300 000 people. Most individuals are residents in the age group of 18-35 years old, while the most vulnerable group is over 50 years old. All estates have a hospital within a radius of 4 kilometers. All involved businesses with a large number of employees or customers operate at a lower capacity. All social, religious, and economic meetings are prohibited and are only allowed after 70% vaccine rollout.
Costs
A single dose of the Pfizer vaccine costs approximately $15, indicating a total cost of $30 dollars per patient. Similar studies demonstrate that the return costs for Pfizer vaccines are approximately $23, while the efficiency of the medication is nearly 95% (Wang et al., 2021). The total cost to vaccinate the entire population will be around $9 billion. The storage cost of the vaccine ranges from $7 to $9 billion dollars. Transport costs to all areas across the country will constitute up to $30 billion. Furthermore, the government will allocate $1.1 billion to recruit new public health staff due to the expectation of a considerable number of patients. Lastly, the infrastructure upgrade and development require approximately $10 billion.
Benefits
The economic benefits will be transparent after the mass vaccination within a 1-year period, and hospitals are expected to raise approximately $1 billion in revenue due to the improved infrastructure. Consequently, the economic sectors will continue operating in full capacity, which, in turn, would have a positive impact on the national finances. The table below demonstrates the approximate financial benefits in the 5-year projection. The net present value (NPV) formula is also presented below.
Table 1: Financial Benefits.
Projection and Comparison
According to the potential financial benefits, the opportunity costs are equal to $90, -$10, -$50, -$90, and -$99.5 billion correspondingly to each year. Therefore, mass vaccination is a highly beneficial financial investment in the long term. In a comparable simulation, Wang et al. (2021) provide the following estimation of financial benefits:
Consequently, the limitations primarily concern the uncertainty of the financial analysis on the national scale since the transport costs, marketing campaigns, and the overall motivation of people to get vaccinated might differ significantly. Nevertheless, the comparison with the existing empirical work confirms the effectiveness of mass vaccination using the Pfizer medication.
Conclusion
Mass vaccination is an effective strategy in regard to both health and financial costs and benefits. While the government will have to invest significant funding in the policy, the financial return is to be expected 1 year after the vaccination. Similar studies demonstrate a financial return of approximately $23 for each Pfizer vaccine. Ultimately, taking into account the productivity losses and negative health consequences, mass vaccination is an effective solution to the COVID-19 pandemic.
References
Arnold, T., Crack, T., & Schwartz, A. (2020). Embedding an NPV Analysis into a Binomial Tree with a Real Options Application. SSRN Electronic Journal.
Chau, C. (2021). COVID-19 vaccination hesitancy and challenges to mass vaccination. Hong Kong Medical Journal, 27, 377-379.
Enthoven, A. (2019). How Systems Analysis, Cost-Effectiveness Analysis, or Benefit-Cost Analysis First Became Influential in Federal Government Program Decision-Making. Journal of Benefit-Cost Analysis, 10(2), 146-155.
Wang, W. –C., Fann, J. C. –Y., Chang, R. –E., Jeng, Y. –C., Hsu, C. –Y., Chen, H., Liu, J., and Yen, A. M. –F. (2021). Economic evaluation for mass vaccination against COVID-19. Journal of the Formosan Medical Association, 120, S95-S105.