Managing the Health Impacts of Climate Change through Sector Projects 21 Step 1 As with the defensive expenditure methodology, since the expected change in environmental quality is assumed to impact people’s behavior (that is, treating illness); an important and key step is to identify the population that may be exposed to the expected change in environmental quality. This relates to the issue of geographical and stakeholder scoping. Step 2 Observe (essentially by means of surveys) the actions and activities that individuals are doing to treat illnesses. Step 3 Measure the costs for individuals undertaking these actions of activities. As indicated in Figure 11, it is important to recognize that the cost of illness is made of different components. First, individuals must incur a direct cost to seek treatment for illnesses. This is covered by both medical and non-medical cost. Second, there may be an indirect cost associated with the illness, due to loss of valuable productive time while treating the illness. This cost must also be included in the cost of illness. Figure 11 Components of the Cost of Illness Cost of Illness Source: Author. Direct Cost Indirect Cost Cost of seeking treatment, diagnosis, and treatment of illness Cost of resource lost due to illness Direct medical costs Direct nonmedical costs Hospital inpatient Physician inpatient Physician outpatient Emergency outpatient Medical supplies Diagnostic tests Drugs and medicines Transportation to seek medical services Time lost while treating illness