Annex 4 analytical methods

This model, which consists in a benefit model and a cost model, was developed to assess the costs and benefits related to different occupational exposure limit scenarios for three carcinogenic substances.

The benefit model enables to estimate the current and future cases of ill health for both cancer and non-cancer endpoints. The key inputs used are described below. The inputs are those parameters whose variation changes the results and for which the model is run multiple times to derive a benefits curve.

In addition to the inputs, the model is underpinned by a range of default assumptions regarding the onset of the disease and its effects. These assumptions differ by substance but do not change depending on the variations in the input data. Some of these assumptions are a simplification of complex real life scenarios or best estimates (where authoritative evidence could not be identified from readily available literature).

The benefit model provides a good approximation of the order of magnitude of the expected impacts and the core calculations are supported by sensitivity analysis. The outputs of the model include:

• The number of new cases for each health endpoint assigned to a specific year in the 60 year assessment period;
• The Present Value (PV) of the direct, indirect, and intangible costs of each case.

The health benefits of implementing new or revised OELs are then calculated in terms of the costs of ill health avoided.

The cost model enables to assess the compliance costs for companies. These costs are estimated on the basis of the inputs described below and are calculated in a worksheet model.

For some sectors, where non-specific data are available, a likelihood model is applied. The likelihood model calculates the costs for a group of similar companies incurred in reducing air exposure to a target OEL based on an assumed sequence of Risk Management Measures implementation which is determined by suitability, effectiveness, and cost. The model is run several times to construct a continuous cost curve.

For other sectors, where the Risk Management Measures to be applied are more well-described, a more simple model is applied, but the same unit costs and life span parameters are used as in the more complex model.

The key inputs used for the benefit model are:

• Rx – Estimate of the risk or fraction of workers affected: this information is based on the Exposure-Risk Relationship (ERR) or Dose-Response Relationship (DRR):
  • ERR: excess risk of developing cancer due to lifetime occupational exposure to a substance (taken here to mean 40 years); and
  • DRR: the proportion of workers that will develop an endpoint when exposed to a certain level.  
• ExW – Exposed workforce: number of workers exposed at different points in time.
• Cx: Exposure concentration: 8-hr time-weighted average (TWA) that the workers are exposed to (real concentration, i.e. if personal protection equipment (PPE) is currently worn, the measured concentrations are adjusted to take into account PPE where possible)

The key assumptions are:

• MinEx – the minimum exposure duration required to develop the endpoint
• MaxEx – the time needed to reach the maximum risk (I.e. after the MaxEx has been reached, the risk of effects do not increase)
• ModEx – the modelled exposure duration (the ERRs and DRRs are for a 40 year period)
• Lat – the latency with which the effect is demonstrated
• The distribution of cases over the period between MinEx and 60 years
• Mortality – Mortality rate as a result of the relevant condition
• Value of a DALY – Monetary value of a case taking into account the direct, indirect, and tangible costs
• Turnover percentage of staff per year; 
• Value of a Statistical Life (VSL);
• Willingness to pay (WTP) to avoid for morbidity;
• Disability weights;
• Discount rates. 

The compliance costs are estimated on the basis of:

• Exposure concentration: 8-hr time-weighted average (TWA) that the workers are exposed to (real concentration, i.e. if personal protection equipment (PPE) is currently worn, the measured concentrations are adjusted to take into account PPE where possible);
• Risk Management Measures (RMMs) needed for reducing the air exposure levels from the actual levels to the target level;
• The costs of the RMMs (one-off and recurrent) for each company and/or workstation;
• The % reduction in exposure of the RMMs;
• The life span of the RMMs;
• The number of companies by size (small, medium and large)
• The number of workstations by size (small, medium and large company)
• The discount rate

The key outputs produced by the benefit model include:

• The number of new cases for each health endpoint assigned to a specific year in the 60 year assessment period;
• The Present value of the direct, indirect and intangible costs of each case.

The health benefits of implementing new or revised OELs are then calculated in terms of the costs of ill health avoided.

The key outputs produced by the cost model are the compliance and monitoring costs for companies for each policy option over the next 60 years.

The model was developed to support the impact assessment accompanying the legislative proposal aiming to revise the Carcinogens and Mutagens Directive 2004/37/EC.  It enabled to estimate the costs and benefits related to different policy options envisaged in the impact assessment.

• Employment and social affairs