The U.S. Environmental Protection Agency (EPA), under the authority of the Clean Air Act, has issued many rules over the past 40 years to protect human health and the environment by limiting air pollution. EPA estimates that four recently proposed or finalized Clean Air Act rules (listed below) will deliver roughly $500 billion in annual economic benefits, and that the economic benefits of the 1990 Clean Air Act Amendments will rise to roughly $2 trillion annually in 2020. EPA's estimates of the economic value of its clean air rules include the value of avoided premature mortality, negative health impacts, lost worker productivity due to illness, and environmental improvements such as increased visibility and agricultural productivity. This report examines some of the health benefits of Clean Air Act rules and estimates the air pollution-related health care savings that result from reduced rates of illness that come from breathing cleaner air. There are two parts to the analysis. The first part of the analysis examines four recently proposed or finalized EPA rules to limit air pollution: the Cross-State Air Pollution Rule, the Utility Mercury and Air Toxics Rule, the Industrial Boiler Rule, and the Cement Kiln Rule. The analysis presented here shows that, because of the reduced rates of serious health problems such as non-fatal heart attacks, chronic bronchitis, and premature mortality, over the next decade these four Clean Air Act rules will yield pollution-related health care savings of over $82 billion dollars, including: (1) $44.6 billion in Medicare, federal Medicaid, and other federal-level health care savings; (2) $2.8 billion in state-level Medicaid and other state and local health care savings; (3) $8.3 billion in out-of-pocket savings by individuals and families; and (4) $24.7 billion in private insurance savings, which ultimately benefits employers and individuals in the form of lower health insurance premiums. The second part of the analysis examines the broader cumulative air pollution-related health care savings from programs implemented pursuant to the 1990 Clean Air Act Amendments. From 2000 to 2020, by reducing pollution, the 1990 Clean Air Act Amendments will yield more than $612 billion in pollution-related health care savings, including: (1) $313.5 billion in Medicare, federal Medicaid, and other federal-level health care savings; (2) $19.0 billion in state-level Medicaid and other state and local health care savings; (3) $54.6 billion in out-of-pocket spending by individuals and families; and (4) $212.7 billion in private insurance spending, which ultimately benefits employers and individuals in the form of lower health insurance premiums. The Clean Air Act and its rules not only significantly reduce the negative health effects from air pollution, but also save billions of dollars in associated health care spending.
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