In general, price controls reduced life expectancy over time. The price control scenario simulated the effect of a 20-percent reduction in manufacturer revenue while holding consumers' out-of-pocket prices constant. Price controls would have small negative effects on life expectancy for current cohorts, but more significant negative effects in the future. For instance, the researchers' best estimates suggest that life expectancy would fall by somewhere in the range of 0.2 years for Americans age 55–59 in 2010 and by approximately 0.1 years for Europeans in the same cohort and year. By 2060, this effect would increase for both Americans and Europeans to approximately 0.7 years. On the benefit side of the ledger, however, U.S. price regulations would reduce spending on drugs and medical care. Annual per capita spending in 2010 would fall for Americans age 55–59 by an amount in the range of $9,000 annually and for Europeans of the same age by an amount in the range of $400. For those age 55–59 in 2060, the savings would be even larger for both groups and, again, greater for Americans than Europeans. The higher number for Americans is attributable to both reduced spending and reduced life expectancy; for Europeans, the savings come entirely from reduced life expectancy. Overall, as shown in Figure 1, the net value of price controls is positive in the short term (2010) for Americans age 55–59, producing approximately $1,100 in per capita savings, but negative for Europeans in the same cohort and year, who face increased costs in the range of $8,000. For both Americans and Europeans, price controls have higher per capita costs over the longer term: By 2060, reductions in life expectancy, after accounting for medical cost savings, would cost the equivalent of $51,000 and $54,000, to age 55–59 Americans and Europeans, respectively.
