Lives Interrupted Calculations Explained

In the Lives Interrupted form, when a user fills the income fields, the program calculates the following:

Income adjusted for inflation

We wanted to produce a conservative but easy-to-produce figure of potential economic losses due to having ME/CFS. Noting that (except for the rich who have done much better than others) incomes have generally kept pace with the rate of inflation over the past several decades, we used the rate of inflation to project what a person’s income might have been had they remained well.

Because this did not take into account expected income gains as people age, our calculation considerably undercut possible losses. For instance, compare the 38K the average 25-year-old brought in in 2020 to the 76K the average 45-year-old brought in. Still the calculation did allow us to take a stab at a persons economic losses due to the disease. We used the Consumer Price Index (or Retail Price Index (RPI) to calculate inflation rates.

Income adjusted for inflation (now) = Consumer Price Index (CPI)(now)/CPI(before) * Income(before)

Because the rate of inflation is different for different countries our CPI/RPI source data is taken from different sources:

Since we don’t have the complete annual averages for the year 2021 data, income adjusted for inflation and losses is calculated using annual averages until May 2021.

Minimum Current Annual Income Loss

Next, we wanted to calculate the minimum income loss due to a person having to work fewer hours or from not being able to work because of ME/CFS. First, we determined what a person’s income would have looked like if they had kept working until the present (or until they retired) – and their income had kept pace with inflation.

y1 = The year a person’s illness started.
y2 = The date used to produce a person’s final income figure. If a person was still working or had to stop working because of illness (but was younger than 65) we used the current year (2021). If a person had retired, we used the year they retired. If a person was over 65 and still working, we used the year the person turned 65 as the last year worked. Each case is shown below in a table.

Income adjusted for inflation y2 = (CPI or RPI at year y2)/ (CPI or RPI at year of illness, y1) * Income produced since becoming ill

Work status

y2

Minimum Current Annual Income Loss, or Minimum Annual Income Loss at Retirement (in case of retirement)

Still working

If age >=65, y2 = year at 65, otherwise y2 = current year (2021)

= (income adjusted for inflation at y2) – (present income)

Retired

y2 = year retired

= (income adjusted for inflation at y2) – (income when retired)

Not working now, not retired

Same as still working

= income adjusted for inflation at y2

(as present income = 0)

On disability

Same as still working

= (income adjusted for inflation at y2) – (income from disability)

 

Total Economic Losses for Years Not Worked

The total economic losses figure due to ME/CFS was created by first calculating the rate of inflation between the time a person came down with ME/CFS and the present date (unless they had retired or were over 65). The Inflation rates were manually calculated using the CPI/RPI data used to calculate losses. We retained 3 decimal places.

For example, for year 2004, inflation rate for USA is calculated using:

= (CPI for 2004 – CPI for 2003)/(CPI for 2003) * 100 = (188.9-184)/184 * 100

=2.663

First, we used the inflation calculator to determine what their annual income would have been if their income had kept pace with inflation.

We then added up the total years they’d worked since coming down with ME/CFS – counting years worked part-time as a 1/2 year worked. We used the inflation calculator to determine their total working income over time.

Then we determined (again using the inflation calculator) what the total income for the years not worked would have been if they had been working. Then we substracted the total years of actual worked income from the projected total years income to come up with a conservative figure of total economic losses due to having ME/CFS. (For simplicity, we removed the decimals by rounding each year’s loss value.)

Total economic losses equal the sum of the economic losses for each year, starting from the year (t1+1) till year t2, where:

t1 = Year of illness -1 + Years worked
t2 = Current year for age <65, or year when turned 65 for age >=65

Example

Assuming the user entered the following data in the form:

Age (as of 2021): 44

Location: USA

Year of illness: 2003

Work status: Still working

Yearly income before illness: $65,000
(This would be the income in 2002)

Present annual income: $60,000

Years worked part-time : 3

Years worked full-time : 2

Program calculations explained below:

Total years worked = Years worked part-time/2 + Years worked full time = 3/2 + 2 = 3.5, rounded to 4

Income when ill-adjusted for inflation (up to 2021)
= (CPI at 2021)/(CPI at 2002) * Income the last year before the person became ill
= 265.144 / 179.9 * 65000 = 95799.66
The projected annual yearly income, if the person had not become il, is $95,800

Minimum Current Annual Income Loss
= (income adjusted for inflation at y2) – (present income)
= 95800 – 60000
= $35,800

Total Economic Losses for Years Not Worked:
Year of illness = 2003
Total years worked = 4
Years since becoming ill (including year of illness) = 2021 – 2003 + 1 = 19
(Note: If the user’s age is 65 and above, the year when the user turned 65 would be considered instead of the current year)

Years of work lost = 19 – 4 = 15

Total economic losses is the sum of losses for each year, starting from year (t1+1) till year t2, where:
t1 = Year of illness -1 + Years worked
t2 = 2021

Here, t1 = 2003 -1 + 4 = 2006 and t2 = 2021 (Current year for age <65)

Therefore, t1 + 1 = 2007

Total economic losses would be the sum of losses for each year, starting from 2007 till 2021.

Losses for year 2007 = (Income adjusted for inflation for 2006) * inflation rate for 2007
Losses for year 2008 = (Income adjusted for inflation for 2007) * inflation rate for 2008
Losses for year 2009 = (Income adjusted for inflation for 2008) * inflation rate for 2009
and so on…

The annual inflation rate for 2008 is calculated using the formula:
(Annual CPI for 2008 – Annual CPI for 2007) / (Annual CPI for 2007) * 100

Year Annual Inflation Rate(%, rounded to three decimals) Income adjusted for inflation (USD, rounded) Notes
2002 65000 6500 is the income before illness, here considered as income preceding the year of illness (2003)
2003 2.279 66481 2003 is year of illness
2004 2.663 68251
2005 3.388 70563
2006 3.226 72839
2007 2.848 74913
2008 3.84 77790
2009 -0.356 77513
2010 1.64 78784
2011 3.157 81271
2012 2.069 82952
2013 1.465 84167
2014 1.622 85532
2015 0.119 85634
2016 1.262 86715
2017 2.13 88562
2018 2.442 90725
2019 1.812 92369
2020 1.234 93509
2021 2.447 95797
Sum of income adjusted for inflation from 2007 to 2021

1276233

Total economic losses for years not worked is the sum of losses from 2007 to 2021, which comes to $1,276,233.

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